USDT issuer Tether says it will freeze addresses linked to sanctioned entities after it was revealed that Venezuela's state oil company used cryptocurrency to avoid sanctions.
A #Tether spokesperson told Cointelegraph that the company still intends to suspend payments related to organizations sanctioned by the Office of Foreign Assets Control (OFAC):
'Tether respects OFAC's SDN list and is working to ensure that sanctioned addresses are frozen as soon as possible. '
This comes after an exclusive Reuters report that Venezuela's state oil company PDVSA used #cryptocurrency to facilitate oil and fuel exports. Venezuela is facing new U. S. oil sanctions.
According to the report, the U. S. Treasury Department has required PDVSA customers and providers to stop trading by May 31, citing Venezuela's failure to implement electoral reforms.
The report, which cited anonymous sources, said the reimposition of sanctions would make it difficult for Venezuela to increase oil production and exports.
The sources said PDVSA is shifting oil sales to the Tether (USDT) exchange to avoid freezing funds in foreign bank accounts if new sanctions are imposed.
The 2023 cryptocurrency payments were reportedly linked to a corruption scandal at PDVSA that uncovered $21 billion in unrecorded receivables related to oil exports.
Reuters sources also claim that PDVSA has reworked its 2024 spot oil deals into a contractual model that requires prepayment for export cargoes in #USDT . Venezuela's state-owned oil company is also reportedly requiring new customers looking to trade oil to store their cryptocurrency in a #digital wallet.
It is believed that after receiving a six-month license from the U. S. in October 2023, companies wishing to resume trading with PDVSA have had to resort to intermediaries to meet the cryptocurrency payment requirements.
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