(Reuters) – Use of digital currencies in Venezuela, expected to increase after the United States ordered a winding down of oil deals with the sanctioned country by May 31, will require closer attention from regulators and law enforcement, it said experts on Monday.
Venezuela’s state oil company PDVSA plans to increase cryptocurrency operations to export crude oil and fuel as the United States reimposes oil sanctions on the country, sources told Reuters earlier this month. It is unclear whether digital currency payments from PDVSA will be targeted by Washington as of June 1.
Venezuelan opposition politician Leopoldo Lopez and expert Christopher Doucette presented a report on Monday detailing operations that have occurred since Venezuelan President Nicolas Maduro took office. Democratic governments should resist his attempts to “use cryptocurrency to move illicit proceeds into the international financial system,” the report said.
“Structures need to be put in place to combat this type of money laundering,” said Doucette, national security director at Chainaanalysis, a New York-based provider of research and software for governments, exchanges, banks and insurance firms to ensure secure cryptocurrency transactions.
Digital transaction technologies are changing rapidly, and transactions are growing rapidly in developing regions including Latin America and Africa, benefiting people without access to the banking system. But some corrupt governments act faster, making it harder to prevent fraud, experts say.
Doucette and Sigal Mandelker, a lawyer who formerly worked at the US Treasury Department, said during a conference organized by the Wilson Center in Washington that the US administration is making efforts to strengthen regulation and encourage other countries to improve oversight.
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