USDT – part of the shadow market in Venezuela

International research organizations are increasingly recording links between the cryptocurrency market and global shadow economic flows. One of the most discussed examples has been the situation surrounding illegal gold mining in the Amazon region and its further circulation through cryptocurrencies. According to a new study by the Global Initiative Against Transnational Organized Crime, in recent years the stablecoin Tether (USDT) has increasingly been used as a means of payment in the trade of illegally mined gold that flows into Venezuela.

The organization’s report, prepared on the basis of interviews with participants in the gold market and analysis of cross-border resource flows, is titled “Shifting Amazon Gold Flows.” It describes a noticeable change in the routes of illegal gold trade in the Amazon region. While previously a significant portion of such metal moved from Venezuela to neighboring countries, primarily Brazil and Guyana, the last two years have seen the opposite trend. Venezuela is increasingly becoming the final destination for illegally mined gold from neighboring countries.

Particular attention in the research is given to gold originating from Guyana. According to analysts, part of this metal is sold in Venezuela, and settlements between participants in these transactions are increasingly conducted not in traditional currencies but in the USDT stablecoin. Such a payment method allows market participants to bypass restrictions related to sanctions, currency controls and the international banking system.

The use of cryptocurrencies in the shadow trade of natural resources is associated with several factors at once. First, cryptocurrency transactions allow funds to be moved quickly between countries without the participation of banking intermediaries. Second, stablecoins pegged to the US dollar make it possible to preserve a relatively stable value of funds in conditions of high inflation or unstable national currencies. Third, cryptocurrency operations can be used to conceal the origin of funds and complicate their tracking.

According to Marcena Hunter, Head of Extractives at the Global Initiative Against Transnational Organized Crime and co-author of the study, the use of USDT in illegal gold transactions has become a noticeable trend over the past year. She notes that the growing role of stablecoins in such operations indicates a broader process of integrating cryptocurrencies into international shadow financial schemes.

At the same time, experts emphasize that it is not only criminal groups that are involved. The report describes a complex ecosystem of interaction between various market participants, including representatives of political structures, security agencies and transnational criminal organizations. Illegal mining and trade in gold in the Amazon region, according to researchers, have become one of the key elements of this system.

The document notes that within Venezuela’s criminal economy the illegal gold trade plays a unifying role. It connects political elites, representatives of the military and various criminal groups operating in the Amazon basin. Such a symbiosis of interests helps maintain the stability of illegal schemes and ensures their further development.

Special attention in the report is given to the economic importance of the gold mining industry for Venezuela itself. According to researchers’ estimates, last year gold mining generated about 2.2 billion dollars in revenue for the country. In conditions of declining oil income caused by both economic difficulties and international sanctions, this sector has become one of the important sources of funding for the state.

Experts also suggest that revenues from the gold trade may have been used by the government to strengthen political support among various groups of influence, including the military and regional elites. This creates additional motivation to preserve the existing schemes of extraction and trade in the precious metal.

An important factor in the growth of cryptocurrency settlements in Venezuela has been the difficult macroeconomic situation within the country. High inflation and restrictions on access to the international financial system have contributed to the spread of digital assets in everyday economic operations. As a result, the Tether stablecoin has become one of the most popular tools for storing and transferring funds.

Research by other analytical organizations confirms this trend. For example, the analytical company TRM Labs previously reported that Venezuela is increasingly using USDT in international settlements amid sanctions pressure and instability of the national currency. In such conditions digital assets become an alternative to traditional financial instruments.

At the same time representatives of the company Tether emphasize that they actively cooperate with law enforcement agencies in different countries in the fight against illegal activity. According to company representatives, thanks to joint work with international law-enforcement structures it has been possible to freeze about 4.3 billion dollars in assets connected with various forms of criminal activity.

Nevertheless, the situation surrounding illegal gold trade in the Amazon region shows how complex the fight against transnational crime becomes in the era of digital finance. Cryptocurrencies, originally created as a tool of financial freedom and technological innovation, at the same time are becoming part of new schemes of money laundering and bypassing international restrictions.

Experts note that such processes require a comprehensive approach from international organizations, regulators and law-enforcement structures. It is necessary to take into account not only the technological aspects of cryptocurrencies but also the broader economic and political context in which they are used.

The situation in Venezuela demonstrates how the combination of natural resources, economic sanctions, political instability and new financial technologies can form complex and difficult-to-control systems of cross-border trade. Under such conditions cryptocurrencies become not only a tool of innovation but also a new element of the global shadow economy.