Venezuela's on-chain spectral presence: USDT becoming hard currency, or a secret establishment of a billion-dollar Bitcoin "shadow reserve."

Author: Nancy, PANews

The "brainless, feel-good drama" that was once criticized has become a real-life prophecy. The raid scene from the American TV series "Jack Ryan" seven years ago recently played out in Venezuela, with President Maduro and his wife being arrested late at night, a scene that left many in disbelief.

With a sudden change of regime, the world's attention has unexpectedly focused on this country mired in inflation. Besides its oil resources facing restructuring, Venezuela is rumored to have secretly established a Bitcoin "shadow reserve" exceeding $60 billion, a staggering hidden sum that is drawing market attention and speculation.

Gold is being traded for Bitcoin as a "safe haven," and USDT has become a hard currency.

The US attack on Venezuela jolted the city awake. Tension, fear, and unease gripped the streets as people held their breath, coping with the uncertainty of the future.

Reports indicate that some local wealthy individuals are converting their gold into Bitcoin to mitigate physical risks, as gold is inconvenient to carry, while Bitcoin offers both flexibility and anonymity.

In fact, in Venezuela today, cryptocurrency has long been integrated into people's daily lives, becoming an important means of hedging, trading, and storing wealth.

Here, the bolivar, the national currency that originally represented the country's credit, has become worthless paper that can be found everywhere on the streets; while crypto assets such as USDT and Bitcoin have become the hard currency that people rely on for survival.

Venezuela should have been an incredibly wealthy country, possessing the world's largest oil reserves, accounting for 17% of the global proven reserves—even surpassing the oil-rich Saudi Arabia. However, this once prosperous nation, ranking fourth globally in GDP per capita, has fallen into a deep abyss due to long-standing political and economic management problems. Today, the extravagant oil tycoons are gone, leaving only ordinary people struggling in the quagmire of inflation.

Under extreme inflation, sovereign currencies lose credibility and weight. People carry bags of banknotes to make transactions by weight, ATMs are emptied year-round, bolivars are made into handicrafts and sold, and even robbers carry POS machines with them when committing crimes.

Venezuelans were forced into a massive financial migration.

According to Chainalysis' 2025 report, Venezuela ranks 18th in the global crypto adoption index, with a crypto transaction volume of $44.6 billion between July 2024 and June 2025. José Gregorio Rodríguez, president of the Venezuelan Commercial Services Committee, also revealed last month that over 30% of the country's businesses, services, and enterprises have begun using cryptocurrencies.

Today, stablecoins have become the de facto digital dollar in Venezuela's daily business activities, with many turning to USDT and other USD-denominated stablecoins as their preferred settlement tool. At one point, the Venezuelan government even used USDT for more public and private payments than for cash transactions in US dollars.

Locals often jokingly refer to USDT as "Binance Dollar" because Binance, the world's largest cryptocurrency exchange, dominates the local P2P (peer-to-peer) trading market. People buy and sell USDT or other assets through this platform, and many merchants, due to government crackdowns on black market exchange rate platforms, directly refer to the real-time USDT/Bolivar exchange rate on Binance for product pricing and settlement.

Furthermore, even Venezuela's vital oil industry primarily uses USDT for settlement. According to local economist Asdrubal Oliveros late last year, approximately 80% of Venezuela's crude oil sales revenue was settled through the stablecoin USDT. At that time, the country's oil production had grown to over 1 million barrels per day, generating annual revenue exceeding $12 billion. This clearly demonstrates the widespread adoption of USDT in Venezuela.

The first country to issue its own token, reportedly holding over 600,000 Bitcoins.

Venezuela has thus become one of the first sovereign nations in the world to embrace encryption.

In 2018, in response to US economic sanctions, Venezuela became the first country in the world to take the plunge. The Maduro government launched the Petro cryptocurrency, backed by the country's oil reserves. From a financial innovation perspective, this was not only the world's first legal digital currency, but also considered an early attempt at tokenizing the RWA (Real Estate Investor).

However, credit is Venezuela's scarcest resource. Despite the government's strong push, Petro was difficult for the public to understand and was perceived as a scam, ultimately ending the six-year experiment in failure. In 2024, the government officially shut down the Petro crypto wallet, and the remaining assets were converted into local currency.

In 2022, the Venezuelan government also attempted to legalize the cryptocurrency mining industry and incorporate it into the national regulatory system, requiring miners to be licensed to work.

Due to the extremely cheap electricity, cryptocurrency mining was once rampant in Venezuela. The profits from a single Ethereum or Bitcoin mining rig could often support a family. The Venezuelan military even converted its camps into massive mining centers and established dedicated maintenance centers to refurbish and repair mining machines.

But a shocking scandal that followed changed everything. The country's state-owned oil company (PDVSA) used USDT to circumvent sanctions in oil sales, resulting in the mysterious disappearance or misappropriation of approximately $21 billion in revenue. Following the corruption scandal, the government's attitude towards cryptocurrencies took a sharp turn for the worse. Citing the need to regulate excessive energy consumption, the government banned mining and confiscated tens of thousands of devices. Because Venezuela lacks a stablecoin business environment, local exchanges have not developed.

However, with the US tightening oil sanctions against Venezuela again in the past two years, Maduro has proposed reviving the cryptocurrency path. The potential cryptocurrency reserves of this early participant have also regained market attention due to US military actions.

According to an in-depth analysis by analyst Serenity based on publicly available information, the Maduro regime is alleged to have quietly established a vast cryptocurrency shadow empire. It is estimated that Venezuela may control between $56 billion and $67 billion in cryptocurrency assets, with implied Bitcoin holdings potentially exceeding 660,000 coins. If these figures are accurate, Venezuela would become the world's fourth-largest Bitcoin holder.

According to further analysis by Serenity, Venezuela allegedly converted gold into Bitcoin between 2018 and 2020. Based on historical data from The Wilson Center and Reuters, the Maduro regime liquidated approximately 73 tons of gold at the time, worth about $2.7 billion. Whale Hunting intelligence revealed that this gold was immediately converted into 400,000 Bitcoins to circumvent a freeze by the US Treasury, with an estimated average price of $5,000 each, now worth approximately $45-50 billion.

Between 2023 and 2025, the Bitcoin earned by Venezuela through crude oil exports is currently worth approximately $10 billion to $15 billion. Previously, due to the failure of its Petro cryptocurrency experiment, Venezuela switched to using USDT as an alternative to petrodollars during crude oil sales. After realizing that USDT could freeze addresses, Venezuela began exchanging USDT for Bitcoin. According to local economist Asdrubal Oliveros at the end of last year, approximately 80% of Venezuela's crude oil sales revenue is currently settled through stablecoins (especially USDT). At that time, the country's oil production had grown to over 1 million barrels per day, with annual revenue exceeding $12 billion.

Between 2023 and 2024, Venezuela also seized approximately $500 million worth of Bitcoin through mining seizures.

It is rumored that the private keys to these assets are held by a small group of trusted agents, with key figures including Venezuelan Minister of Industry and National Production Alex Saab, who uses mixers, cold wallets, and other methods to cover up the flow of assets.

While the theory of "shadow reserves" is presented with great certainty and aligns with Venezuela's logic of circumventing sanctions, direct on-chain evidence is currently lacking. According to publicly available tracking data from Bitcoin Treasuries, Venezuela's confirmed holdings since the end of 2022 amount to only 240 BTC (approximately $22.33 million).

With Maduro's future uncertain, it remains unclear whether the US government will attempt to seize such a large amount of Bitcoin reserves.

Regardless of the actual size of holdings, for the Maduro government and other sanctioned economies, the significance of crypto assets has long transcended financial innovation itself. They serve as both a monetary medium for ordinary people and a weapon for nations to maintain their survival and circumvent global financial blockades. A crypto arms race has already quietly begun among sovereign nations worldwide.