(Reuters) – Venezuela’s use of digital currencies, which is expected to increase after the United States ordered a wind-down of oil deals with the sanctioned country by May 31, will require greater scrutiny from regulators and law enforcement, experts said on Monday .
Venezuelan state oil company PDVSA plans to increase cryptocurrency transactions for its crude oil and fuel exports as the US reimposes oil sanctions on the country, sources told Reuters earlier this month. It is unclear whether digital currency payments made by PDVSA will be targeted by Washington from June 1.
Venezuelan opposition politician Leopoldo Lopez and expert Kristofer Doucette presented a report on Monday detailing transactions since Venezuelan President Nicolas Maduro took office. Democratic governments should counter his efforts “to exploit 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 leader at Chainalysis, a New York-based provider of research and software to governments, exchanges, banks and insurance companies to secure secure cryptocurrency transactions.
Digital transaction technology is changing rapidly and transactions are growing rapidly in developing regions, including Latin America and Africa, benefiting those without access to the banking system. But some corrupt governments are moving faster, making it difficult to prevent fraud, the experts said.
Doucette and Sigal Mandelker, a lawyer who previously worked at the U.S. Treasury Department, said at a conference hosted by the Wilson Center in Washington that the U.S. government is making efforts to tighten regulations and encourage other countries to improve oversight.
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