Washington aims at Venezuela’s cryptocurrency in new round of sanctions

The White House on Monday continued tightening financial sanctions on Venezuela, banning U.S. citizens from using the Petro, the socialist administration’s newly launched cryptocurrency.

The presidential executive order, which went into effect at 12:15 p.m. on Monday, prohibits Americans from dealing in “any digital currency, digital coin, or digital token” issued by Venezuela after January 9, 2018.

Venezuela launched the Petro last month, and President Nicolás Maduro had touted the initiative as a way to raise international financing amid Washington’s crackdown.

The Trump administration said any investment in the digital currency should be viewed as “directly supporting this dictatorship and its attempts to undermine democratic order in Venezuela.”

“The Petro is a desperate effort by a corrupt regime to defraud international investigators,” a senior administration official said on the announcement. “At face value, the Petro is a scam ripe for exploitation by corrupt regime insiders seeking to defraud

international investors and ordinary Venezuelans.

Also Monday, the U.S. Treasury sanctioned four current and former economic and finance officials in Venezuela, freezing their assets and barring U.S. citizens from doing business with them.

Among them: Américo Alex Mata García, a director of the National Bank of Housing and Habitat, who is accused of soliciting bribes from Brazilian construction giant Odebrecht when he was the coordinator of Maduro’s 2013 election campaign. Venezuela’s former top prosecutor, Luisa Ortega, has said the Maduro camp asked Odebrecht for $50 million in payments in exchange for future contracts, but only received $35 million.

Read More: Amid economic collapse, Venezuela gets inventive

Also named were William Antonio Contreras, the head of the Superintendency for the Defense of Socioeconomic Rights; Nelson Reinaldo Lepaje Salazar, the head of the Office of the National Treasury of Venezuela; and Carlos Alberto Rotondaro Cova, the former president of the board of directors of the Venezuelan Institute of Social Security.

President Maduro decimated the Venezuelan economy and spurred a humanitarian crisis,” U.S. Treasury Secretary Steven Mnuchin said in a statement. “Instead of correcting course to avoid further catastrophe, the Maduro regime is attempting to circumvent sanctions through the Petro digital currency — a ploy that Venezuela’s democratically-elected National Assembly has denounced and Treasury has cautioned U.S. persons to avoid.”

“We urge Maduro to distribute humanitarian aid and stop blocking much-needed foreign assistance to the suffering people of Venezuela, and we again call upon the Venezuelan military to respect and uphold the Constitution,” he added.

Republican Sen. Marco Rubio, of Florida, praised the new measures.

“This move against corrupt officials in the Maduro regime targets their ability to use cryptocurrencies to circumvent U.S. and international sanctions,” Rubio said. “I commend the president and his administration for continuing to take action against efforts by the illegitimate Maduro regime to exploit illicit financial lifelines, and encourage additional sanctions in the weeks to come.”

In August, Washington prohibited U.S. financial institutions from dealing with Venezuelan debt. And more than 20 current and former Venezuelan officials, including Maduro, have been hit with individual sanctions.

Read More: U.S. says sanctions are ‘absolutely’ working

The new round of measures comes as Maduro is hoping to win another six-year term during elections scheduled for May 20. The United States, Venezuela’s opposition leaders and many countries in the region say the snap election — being held months ahead of schedule — will neither be free nor fair.

The European Union and Canada have also imposed sanctions on the country.

Read More: Amid split in opposition, one man hopes to beat Maduro at polls

Venezuela has long accused Washington of using its economic might to destabilize the administration. It claims the financial sanctions in particular, which have kept it from renegotiating some debts and limited its ability to pay for imports, are exacerbating shortages of food and medicine that are fueling a mass exodus.

On Twitter, Diosdado Cabello, a powerful Venezuelan politician, said “imperialism has made a mistake with the announcement of new sanctions and a blockade against the battle-hardened and dignified people of Venezuela...We will win!!”

McClatchy reporter Franco Ordoñez contributed to this report from Washington, D.C.

Follow me on Twitter @jimwyss

As Venezuela’s economy continues to crumble, thousands of its citizens are trekking into Colombia every day — sometimes by walking hundreds of miles on foot through the Andes — to escape chronic shortages of food and medicine, frequent looting and