Key facts: Bitcoin mining is supervised as established in the Comprehensive Cryptoasset System. In 2020, the authorities began to issue permits and prohibited the confiscation of miners. With the raid of farms and confiscation of equipment for bitcoin mining, activity in Venezuela seems to return to the dark stage it experienced more than five years ago when it was common for information to circulate about the seizure of miners in the country. This is a situation that forced many to operate practically clandestinely and that Venezuelan miners believed to be overcome, after the legalization of the ecosystem that occurred in 2019. This, after the government issued a decree with the purpose of defining the regulatory framework applicable to the Comprehensive Cryptoasset System. It was from this decree that measures came into force to regulate and supervise the entire bitcoin (BTC) industry and other cryptocurrencies, making Venezuela in one of the first countries in Latin America to create specific standards for the sector. Prior to this, in 2018, a supervisory body had already been created: the Venezuelan Superintendency of Crypto Assets and Related Activities (SUPCACVEN), which was later renamed the National Superintendency of Crypto Assets and Related Activities (SUNACRIP). The issue of being pioneers in regulation was used by the government as an argument to highlight the country's progress in the sector, as the former Crypto Asset Superintendent, Joselit Ramírez, pointed out on several occasions in statements to the media. This, as part of a promotional display around the petro, a digital currency launched in 2018.
Joselit Ramírez, former Crypto Assets Superintendent now in prison, in statements to the media. Fountain. YouTube/Sunacrip. Based on the new regulations in force, the Comprehensive Registry of Cryptoactive Services (RISEC) emerged, whose purpose was to systematize information related to cryptocurrency companies and users, which included bitcoin exchanges. Later, in 2020, another decree gave legal range for bitcoin mining. It was established that the interested in carrying out mining activities legally they had to apply for a license. To comply with the regularization of miners, the Comprehensive Registry of Miners (RIM) was created as a complementary module within the RISEC. Through RIM The processing of mining licenses was facilitated. To obtain them, miners began to provide information to the authorities about the activities they carried out, whether marketing, importing or using mining equipment. Special licenses were even requested for those interested in manufacture ASIC equipment in national territory or build mining farms.
The licenses granted to miners by SUNACRIP varied depending on the activity. Source: crixto.zendesk.com. This is how, gradually, those interested in mining Bitcoin in Venezuela began to register, complying with the requirements and precautions required, because if they did not have the authorization SUNACRIP could seize digital mining equipment.
One of the particularities of this regulation was that the raiding of farms and the confiscation of equipment was prohibited, without the participation of SUNACRIP. This sought to prevent police authorities from carrying out arbitrary confiscations, without the presence of the supervisory entity. It was also established that the mining farms «would operate with the support of the State», which had to be aware of the activities. Consequently, the Venezuelan government decided that he would be aware of each of the processes that make up the activity. Here the state electricity company got involved: Corpoelec, in charge of supplying energy to the farms and charging for the service at certain rates. SUNACRIP's role in the industry was subsequently ratified. In 2022, the Supreme Court of Justice (TSJ), in ruling No. 099, ruled that those who wanted to mine Bitcoin in Venezuela had to be compulsorily registered in SUNACRIP and have all the corresponding permits. With all these regulations in force, a new stage for cryptocurrency mining in the country seemed to have begun. Everything seemed to indicate that the stigma that affected miners and that for several years made them targets of seizures, jail and fines had been overcome. This is because authorities used to associate mining with illicit activities such as money laundering. With regulation, Bitcoin mining became a legal practice, and the narrative also continued to be fed that the activity was no longer taking place clandestinely. In this way, the myth was born that miners only operate in a hidden way and not as part of one of the most thriving industries of recent times in Venezuela. As stated to BitcoinDynamic by the group of Cripto Nonza lawyers, authors of the first Legal Manual on the use of cryptocurrencies in Venezuela, for 2022 They saw a favorable outlook for the industry. They considered current regulations as a key point for the development of Bitcoin mining in Venezuela, by establishing clear rules to understand what was allowed and what was not. Above all, they highlighted the prohibition of police entities from carrying out raids and seizing miners.
If they proceed in this way (with confiscations), security agents or officials can be punished with imprisonment of up to five years, this penalty being even the most serious established in the decree. This makes it clear that there was a serious problem and that the legislator had to establish this sanction for the officials because the matter was getting out of hand. José Ángel Mogollón, lawyer for the Cripto Nonza group.
After regulation, uncertainty returns
Despite the progress achieved with regulation, the outlook for Venezuelan miners changed abruptly in 2023 with the outbreak of the scandal known as «PDVSA-crypto», which involved the crypto assets superintendent, Joselit Ramírez, in a corruption plot that led him to prison. SUNACRIP was intervened and taken over by an intervening board and its activities were practically suspended. There were even rumors about his disappearance, after the dismissal of his staff. In this way, Venezuelan Bitcoin miners entered a kind of regulatory limbo, since it was decided to shut down the farms and months passed without having any statements from the supervisory body or the government. The situation brought a new wave of darkness for members of the sector, who have been immersed in uncertainty for more than a year. All this occurs despite the fact that, in theory, the regulations approved more than four years ago to regulate the sector are still in force. But in practice it is not known what the purpose of the Venezuelan authorities is. This is a complex circumstance that characterizes Venezuelan jurisprudence and that is now manifested with the raids and seizures of equipment that are taking place, after announcing the ban on Bitcoin mining.