Tether, a stablecoin supplier, will block all wallets utilizing USDT to avoid unnecessary sanctions pertaining to oil exports in Venezuela.
This comes at a time following Reuters informing that the state-operated oil company in Venezuela, PDVSA, has raised its tether usage after the US repeated its sanctions on oil exports.
The company blocked 21 wallets linked with the US Department’s Office of Foreign Assets Control (OFAC) Specially Designated Nationals (SDN) list at the end of last year.
As per a spokesperson from Tether, the company stands by the OFAC SDN list and will be actively involved in ascertaining sanction addresses are effectively blocked.
In 2023, PDVSA started utilizing USDT, which only increased after the US decided to repeat its sanctions, keeping Venezuela’s forthcoming elections in mind.
Venezuela started testing cryptocurrencies in 2018 and established a token named Petro. The intention was to address the economic imbalance propelled by the US sanctions. However, the project soon saw a closure.
Utilizing cryptocurrencies enables PDVSA to evade transacting with cash that we could withdraw if it exists in off-shore bank accounts. As per Reuters, PDVSA utilizes middle parties while carrying out transactions with Tether for less visibility.
OFAC understands crypto usage since it has been hard on the industry for a year now. It has fined Coinlist $1.2 million for supporting Russian users avoiding sanctions, following sanctions on a crypto mixer that was supposedly utilized by hackers based in North Korea.
Towards the end of 2023, Tether blocked 32 crypto addresses linked with terrorism and the war between Israel and Ukraine. Previously, Tether had not blocked wallets linked with the sanctioned coin-mixing solution, Tornado Cash.
