Venezuela - As the US looks to ease sanctions on Maduro, foreign miners will still need to dodge radioactive individuals
Crypto investors need to navigate a tough landscape of interests that control the electricity and machinery import markets in Venezuela.
Venezuela’s Caracas Commodity Exchange (CCSCEX) launched last week just as the government of Nicolas Maduro looks to restart negotiations in Mexico City.
Maduro is effectively looking for Biden’s administration to lift sanctions on key individuals close to him and his wife in exchange for the concessions that Washington and the opposition want. Since the capture of Colombian businessman and operative for Maduro Alex Saab in October 2021, Maduro’s personal finances are pinched.
Maduro needs relief. Negotiations with Venezuela’s US counterparts are expected to restart on June 10th. Interestingly, just as negotiations are slated to begin, crypto regulator SUNACRIP launched a blockchain-based exchange for trading tokenized securities. Daniel Valero the head of the exchange, a public-private initiative.
The thing is, even though there might be a picture of ‘opening’ in Venezuela’s sanctioned economy, foreign investors interested in the country’s low-cost electricity resources for digital asset mining will still find a challenging landscape of local partners to navigate.
Take the crypto firm BCI Technologies as an example. Since 2018, BCI has imported ASICs and set up mining facilities in the cities of Maracaibo, Barquisimeto, Mérida, Valencia and Coro.
Samer Akil Rada owns and operates BCI Technologies, a crypto mining company based in Valencia but possibly registered in Texas as an electronics dealer. He started some time in 2018 after apparently running a pizzeria out of Barranquilla, Colombia. His Twitter profile starts in 2018 and shows him as a gung-ho entrepreneur who supports women getting education degrees and mentors university students.
According to a report authored by the Atlantic Council in October 2020, Samer Akil Rada is part of the Rada Clan, a Lebanese family network that mines crypto in Venezuela. They have close links to Joselit de la Trinidad Ramirez Camacho, the head of Venezuela’s crypto regulator, SUNACRIP. Ramirez has a $5 million bounty for helping members of Maduro’s government avoid sanctions.
Samer Akil Rada’s experience involves coal exports from Colombia, importing and exporting women’s lingerie, a Colombian pizzeria, and vapes. He’s reportedly linked to Amer Akil Rada, a dual Venezuelan-Lebanese citizen understood to be involved in money laundering and the 1994 bombing of AMIA in Argentina. This Atlantic Council report argues that the Rada Clan has links to a broader Hezbollah network active in Venezuela.
Part of easing sanctions on Venezuela involves bringing in US and other Western businesses to lead development in the country and head off firms aligned with Russia and Iran. It appears that Chevron, the US oil producer, will be allowed back into Venezuela by the Biden administration if there is a deal.
But it will be difficult for foreign investors interested in crypto and Bitcoin mining to navigate a landscape when, regardless of sanctions relief, there are radioactive figures like Akil Rada controlling the imports of ASIC machinery and the access to Venezuela’s low-cost electricity grid. It’s risky to assume that electricity cost is the only cost for Bitcoin mining when unsavory importers and brokers still control the market. Dealing with the latter individuals, too, will be costly.