Reports indicate that USDT is being used in Venezuela to facilitate settlements and avoid sanctions – Bitcoin News

Some companies in Venezuela use stablecoin tethers as a way to circumvent sanctions and settle payments with foreign customers and suppliers. Local reports indicate that while the most popular use case for the stablecoin involves its purchase for devaluation purposes, a handful of companies are also using it this way.

Companies are reportedly using USDT to avoid being hurt by sanctions in Venezuela

While the use of dollar-pegged stablecoins, such as Tether’s USDT, in countries like Venezuela is mainly related to inflation and devaluation according to Chainalysis, another use case has recently been discovered. Reports from local analysts state that a handful of companies are using USDT as a payment method for foreign customers and providers, who are afraid to use traditional means of payment due to the risk of sanctions.

According to Juan Blanco, director of local consulting firm Bitdata-consultants, many unidentified companies are taking up commercial exchanges using USDT, with part of this cash flow coming from companies located in Asia and Russia. Blanco stated:

There are things produced in Venezuela with great value that are traded in USDT. The little that is exported, due to the issue of the blockade, leaves the country through the free and independent mechanism provided by the blockchain to pay for goods and services.

Luis Gonzalez, head of Cashea, a local financing center, stated that sanctions affect Venezuelan small and medium-sized enterprises, even when these are not considered in their scope. Gonzalez explained:

With the sanctions, they limit us, which have nothing to do with political issues. Access to international transfers, currency, means of payment and suppliers is limited. It is clear that most payments are made abroad and in foreign currency. The only option we have had is the use of USDT.

Crypto for oil

The reports about the possible implementation of cryptocurrencies to circumvent sanctions in Venezuela come from 2019, when the central bank of the country studied using ether and bitcoin to pay suppliers of PDVSA, the state-owned oil company, according to Bloomberg.

More recently, in October, the Justice Department indicted five Russian nationals and two oil brokers who used USDT as part of a scheme to buy equipment for the Russian military and sell Venezuelan oil. The indictment alleges that at least one sale of 500,000 million barrels of crude oil may have been settled using USDT.

What do you think of the uses that Venezuelan companies have found for USDT? Tell us in the comments section below.

Sergio Goschenko

Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as late to the game, entering the cryptosphere when the price spike occurred during December 2017. He has a computer engineering background, lives in Venezuela and is influenced by the cryptocurrency boom on a social level, offering a different point of view on crypto success and how it helps the unbanked and underserved.

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