Tether Will Freeze Addresses Amid Reports of Venezuelan Oil Company Using USDT to Evade Sanctions

Tether freezes addresses after reports that Venezuelan oil company is using USDT to evade sanctions

Popular stablecoin issuer Tether responds to a recent Reuters report that revealed Venezuela’s state oil company PDVSA is using cryptocurrencies to circumvent oil and fuel export sanctions. teeth, USDTannounced an initiative to freeze addresses associated with sanctioned entities. A Tether spokesperson emphasized that the company respects the Office of Foreign Assets Control’s (OFAC) SDN list and is committed to promptly freezing addresses associated with sanctioned entities.

A Reuters report citing anonymous sources said, highlighted Venezuela is facing new U.S. oil sanctions. The U.S. Treasury Department has set a May 31 deadline for PDVSA customers and service providers to curtail transactions due to Venezuela’s failure to implement necessary electoral reforms.

Officials said the reimposition of sanctions would pose a challenge for Venezuela to increase oil production and exports because companies would need U.S. permission to do business with the South American country. To reduce the risk of funds in foreign bank accounts being frozen as new sanctions come into effect, PDVSA has reportedly moved its oil sales to Tether’s USDT stablecoin.

The report further suggests that PDVSA has adjusted spot oil transactions for 2024 to a contract model that requires prepayment of export cargoes in USDT. Additionally, the national oil company is said to be requiring new customers involved in oil trading to hold cryptocurrencies in their digital wallets.

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