Breaking News

Venezuela enacted decree to force bitcoin miners to register

A Venezuelan official said the Bitcoin miners must register with the state.

Some people think that cryptocurrency may be a solution to the Venezuelan financial crisis. Earlier this month, President Nicolás Maduro announced that the country will issue its own cryptocurrency, called "Petro," which will be pegged to commodities such as gold, oil and gas. At a meeting on December 12, 2017, Carlos Vargas, Venezuelan cryptocurrency director, told the media that the government planned to set up a miner registration department.

Vargas said: "We want to know who they are, we want to know where they are and we want to know what equipment they are using."

The compulsory registration platform will be launched on December 22.

On December 9, prior to the announcement, authorities in Lara County raided a warehouse in Barquisimeto. They seized 21 mining equipment and arrested Daniel Andrés, 31. Subsequently, he was accused of money laundering and illegal profit-making, committing computer crimes, financing fraud, damage to the national grid and several other charges.

In an official statement, the police no longer ambiguous about the legitimacy of cryptocurrencies, saying:

"Digital currency is not recognized by any national banking institution nor is it approved by any country." The digital currency marketization appears to be legal and is essentially a cliche. "
This arrest was exactly when the Venezuelan economy had reached a serious crisis. The hyperinflation in Bolivar has forced government experts to begin assessing the feasibility of issuing mandatory administrative orders on the last resort. In stark contrast to Bolivar at its lowest point, cryptocurrencies such as Ethereum and Bitcoin continue to create record highs. The growing market may be a catalyst for the government to step up its supervision because the state must work hard to maintain its economic balance.

Angel Salazar, founder of OnixCoin, an optimistic e-money regulatory consultant for the Venezuelan government, expressed optimism about the miner's registration system.

"The miners are currently working under difficult conditions and the adoption of this registration system will help protect them from blackmail and harassment."
However, some people disagree. David Fernando López Torres once owned a mining company in Venezuela but later opened a store in San Francisco. He said:

"If the government does not protect the rights of miners when they do not have a registration system, can anyone believe that the government really protects miners' rights when they have a registration system?"
He predicted that miners would ignore the registration requirements and take additional protective measures to work underground.
One of the possible reasons for regulation by all evasion authorities is the extortion by police. In fact, mining in Venezuela is not illegal unless you are involved in energy theft or financing of terrorism. Except that the above two items can be used as a justification of arrest, the remaining legal acts should be provided by the government for protection.