The United States Treasury Department has imposed further sanctions on Russia, this time adding bank Evrofinance Mosnarbank, jointly owned by Russian and Venezuela groups, to the long list of Russian-related entities that have been sanctioned by the American government.
The Moscow-based bank has been added to the list because, according to the Treasury’s press release, “it was the primary financial institution willing to finance” the oil-backed cryptocurrency of the nation, the Petro.
The action taken by the U.S. Treasury has severe consequences:
As a result of today’s action, all property and interests in property of this entity, and of any entities that are owned, directly or indirectly, 50 percent or more by this entity, that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC.
Treasury Secretary Steven T. Mnuchin railed against those entities that supported the Maduro regime:
The illegitimate Maduro regime has profited off of the suffering of the Venezuelan people. This action demonstrates that the United States will take action against foreign financial institutions that sustain the illegitimate Maduro regime and contribute to the economic collapse and humanitarian crisis plaguing the people of Venezuela.
The press release also describes how the Petro would be used to avoid U.S. sanctions:
When the failed Venezuelan cryptocurrency, called the Petro, launched in 2018, Evrofinance emerged as the primary international financial institution willing to finance the Petro. Early investors in the Petro were invited to buy the cryptocurrency by wiring funds to a Venezuelan government account at Evrofinance. Evrofinance’s involvement in the Petro demonstrated Maduro’s hope that the Petro would allow Venezuela to circumvent U.S. financial sanctions.
Increasingly, Venezuelan citizens have turned to crypto transactions and usage for survival.
Russia has described its own plans to launch an oil-backed cryptocurrency, though no formal concepts have been released. Additionally, Russian President Vladimir Putin has asked the country’s lawmakers to form crypto regulation by July 1.
By Abhimanyu Krishnan