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New restrictions on crypto transactions in Venezuela

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The Venezuelan public woke up to terrible news indeed. According to the announcement, the Venezuelan government has finally begun fully monitoring and regulating cryptocurrency transactions within the country. The decree was published in the country’s Official Gazette that the SUNACRIP (Venezuelan National Superintendency of Crypto Assets and Related Activities) will take full authority over crypto transactions within the borders.

Starting from today, the residents who utilize cryptocurrency transactions will be subject to taxation of 15% of the transacted amount, limitations on the transactions as well as screening (ultimately taking away the anonymity).

The taxes

The taxes seem to be “floating” as there is no specific information that there will be a 15% commission. However, it does imply that there will be a “maximum” of 15%, which only leaves us to find out what the minimum is. According to some translated quotes, the minimum fee charged by SUNACRIP is 0.25 euros on every transaction. This may seem laughable, but it needs to be considered that this is the “minimum” that they can charge.

SUNACRIP will use a specific technological platform in order to identify and charge transactions. The technology is not specified, however, according to some details, we can see that it is very similar to what Forex brokers like KontoFX use. It’s dependant on the algorithm, which just searches for the class attribute of an asset, if it determines that the transaction is in cryptos, it will immediately charge a commission, identify the sender and of course limit the amount.

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Hyper-inflation is contagious?

These types of limitations are sure to cause even more damage to the already economically suffering population. Many residents rely on crypto transactions from abroad to survive as Bolivars (The Venezuelan Currency) are no better than toilet paper at this point. The CEO of Dash has already highlighted the problem when he mentioned the huge amount of refugees fleeing the country in order to support their families that stay behind.

It seems that there is no end to questionable economic decisions from the authorities in Venezuela. The hyperinflation of the Bolivar, the introduction of Petro (Venezuelan cryptocurrency), and now these fees on transactions.  

It’s not that cryptocurrencies are going to suffer from inflation because of Venezuela, but there is a high chance that Dash may suffer from the loss of customers. One thing experts can’t understand is to why there is a limit on the crypto transactions. If the new regulation was an attempt at a cash-grab then a limit wouldn’t be installed. Therefore it is only reasonable to assume that the SUNACRIP is trying its best to limit competition for the Petro, which already is a dying project (and it’s not even born yet).

Regardless whether this law is implemented and realized is up for debate, however. The reason is that there may be a change of government in Venezuela soon, judging from all the political pressure from the international community, Maduro may have to relinquish his position in the near future.

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