Venezuela Legalizes Crypto Mining, Forces Miners to Use National Mining Pool

The Venezuelan government has published a new decree in the Official Gazette legalizing cryptocurrency mining, but with a catch: crypto miners have to use a national mining pool.

According to local news website CriptoNoticias, the new decree was authorized by Joselit Ramirez, head of Venezuela’s National Superintendency of Crypto Assets and Related Activities (SUNACRIP). It states any entity wishing to mine cryptoassets in the country has to register with the government and apply for a license.

Applicants will have to hand over information to authorities on the nature of their crypto mining activities, and keep mining-related records for a decade. Cryptocurrency mining equipment manufacturers and data centers will be able to apply for a special license.

Those who import or manufacture mining equipment will have to be supervised by authorities, according to the report, and all crypto mining activities will have to be carried out through the official National Digital Mining Pool. Those who operate outside of it will face penalties.

Centralizing mining in the country through a single national pool will allow the government to control income earned from the miners, and the payouts sent to contributors. The Venezuelan government could, as such, freeze or delay miners’ payments, or tax mining earnings before sending them to miners.

Venezuela’s economy has been suffering from economic mismanagement and hyperinflation, which according to Bloomberg’s Café Con Leche Index was of 2,400% over the last 12 months. Venezuelan leader Nicolas Maduro launched a purportedly oil-pegged cryptocurrency called the Petro in a bid to bring in foreign currency.

To bolster the Petro’s adoption the government has started accepting it for passport payments and is looking to collect taxes in it.  The head of the country’s cryptocurrency initiative, Joselit Ramirez Camacho, has seen the U.S. Immigration and Customers Enforcement (ICE) add him to its Most Wanted List, accusing him of violations related to drug trafficking.

Featured image via Pixabay.