Back to the list

Why is the Crypto exchange Uphold halting operation in Venezuela?

www.thecoinrepublic.com 25 June 2022 04:05, UTC
Reading time: ~2 m

Crypto exchange firms along with traditional companies get stuck under the companies that governments put on them

One of the well known crypto trading platforms Uphold said that it is pulling back its services and support for Venezuelan users. This decision of the crypto exchange derivatives company came in the wake of sanctions imposed on Venezuela by the government of the United States. 

In an announcement on Thursday, Uphold said that due to the growing complexities to comply with the United States imposing sanctions, the company would be moving out and seizing its operations in Venezuela, unwillingly. Further crypto derivative firms advised their users in Venezuela to complete withdrawal of their funds. Uphold told them to do this as soon as possible citing that the operations related to trading for its clients in Venezuela would stop on 31st July while all the accounts getting fully restricted from 30th September. 

The platform said that being an American financial institution, Uphold needs to go along with the sanctions programs imposed by the US that are administered under the US Office of Foreign Asset Control (OFAC). The current sanction program also included against the Venezuelan government, their employees and state owned entities. Further it had said that until there is any change in the current applied law or without any specific permission from OFAC, the imposed regulations would not let Uphold release funds to customers residing in Venezuela. 

A lot of sanctions that are currently imposed in Venezuela and related entities by the US government came into effect way back in August 2019. This action followed the decision of the previous administration that stopped transactions made with citizens and companies of the United States when the US government ordered to freeze all the assets belonging to the Venezuelan Government. It was in May, when US President Joe Biden gave some relaxation over the sanctions following the focus on restrictions put on Chevron, a prominent oil company in the US. 

The current order of US government to make crypto exchanges stop operating in the Venezuela came due to the reports claiming that Venezuelan government is trying to evade the sanctions while using cryptocurrencies like bitcoin (BTC). 

Back to the list