USDT Remains Vital in Venezuela as Maduro Case Sparks Renewed Scrutiny

Nicolás Maduro’s arrest and detention in the United States has once again placed Tether and its USDT stablecoin under global scrutiny, highlighting the outsized role stablecoins play in Venezuela’s economy. Despite increased attention from U.S. authorities, analysts argue that USDT will likely remain deeply embedded in both Venezuela’s oil trade and everyday financial life due to persistent inflation and institutional weakness.

According to reporting by The Wall Street Journal, USDT has served two critical functions in Venezuela. First, it has enabled the country’s state-run oil industry to continue exporting crude despite heavy U.S. sanctions that restrict access to the global banking system. Second, it has become a practical dollar-pegged alternative for citizens facing the near-total collapse of the Venezuelan bolívar. Over the past decade, the local currency has lost roughly 99.8% of its value against the U.S. dollar, making stablecoins an attractive store of value.

Maduro, currently held in a Brooklyn jail, has pleaded not guilty to narcotrafficking charges in U.S. federal court. His case has intensified efforts to monitor financial flows linked to the Venezuelan state. Since 2020, Petroleos de Venezuela (PdVSA) has reportedly accepted oil payments in USDT, with settlements sent directly to digital wallets or routed through intermediaries who convert proceeds into Tether. Venezuelan economist Asdrúbal Oliveros has estimated that close to 80% of the country’s oil revenue is now collected through stablecoins, underscoring their central role in state cash flow.

Tether has stated that it cooperates with U.S. and international authorities and has frozen wallets associated with sanctioned Venezuelan oil transactions. Still, experts note the dual nature of stablecoins. Adam Zarazinski, CEO of Inca Digital, says USDT remains a daily hedge for Venezuelans, while simultaneously creating pathways for sanctions evasion. Ari Redbord of TRM Labs echoes this concern, emphasizing that stablecoins can function both as a civilian lifeline and a tool for illicit finance.

Beyond oil, USDT is increasingly used for cross-border transfers and everyday purchases, driven by distrust in domestic banks, capital controls, and limited access to physical dollars. Venezuela’s failed oil-backed Petro token further reinforced public preference for widely accepted stablecoins like USDT. As long as economic instability persists, demand for dollar-linked digital currencies in Venezuela is unlikely to fade.