Menendez Hints At US Action on Venezuela's Controversial Crypto

A U.S. senator who has previously spoken out against Venezuela's newly launched "petro" cryptocurrency isn't done with the issue.

AccessTimeIconFeb 23, 2018 at 3:05 p.m. UTC
Updated Sep 13, 2021 at 7:36 a.m. UTC
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A U.S. senator who has previously spoken out against Venezuela's newly-launched cryptocurrency isn't done with the issue.

Late last month, Senators Bob Menendez (D.-NJ) and Marco Rubio (R.-FL) co-wrote a letter blasting the "petro" and asking the Treasury Department to monitor its progress, as well as offer insight into how the department might work against the token's use to flout U.S. sanctions.

Menendez further raised the issue during a hearing on Feb. 6 of the Senate Committee on Banking, Housing and Urban Affairs. During that hearing, neither Securities and Exchange Commission chairman Jay Clayton nor Commodity Future Trading Commission chairman J. Christopher Giancarlo would say whether their respective agencies could restrict the petro's use in avoiding U.S. sanctions.

However, Giancarlo did say the CFTC "would certainly look at" the token if it is used to defraud U.S. customers.

In light of this week's controversial launch of the oil-backed cryptocurrency, CoinDesk contacted the offices of Menendez and Rubio for comment on whether they plan to undertake additional measures in light of unproven claims of a $735 million first-day pre-sale haul. On Thursday, Venezuelan President Nicolas Maduro claimed that the government had raised in excess of $1 billion over two days, according to local sources.

A spokesperson for Senator Menendez, in an email to CoinDesk, highlighted guidance issued by the U.S. Treasury Department published on Jan. 19 in light of the cryptocurrency launch.

It states that "a currency with these characteristics would appear to be an extension of credit to the Venezuelan government" – prohibited by an August 2017 executive order signed by President Donald Trump – and that "U.S. persons that deal in the prospective Venezuelan digital currency may be exposed to U.S. sanctions risk."

"We continue to look for ways to prevent the Maduro regime from brazenly evading US sanctions and plan to follow up with the Department of Treasury following their issuing of these guidelines," the spokesperson said.

Senator Rubio's office did not respond to requests for comment.

Bob Menendez image Shutterstock

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