Coinbase Transfers Halted in Venezuela

Initially revealed on August 2, 2018, several Venezuelan Coinbase users abruptly lost the ability to withdraw or send cryptocurrency, prompting speculation that the exchange may have its hands tied by US-Venezuela sanctions.

Purportedly, Venezuela-based Coinbase users are still able to buy or sell cryptocurrency on the platform but may run into trouble when attempting to withdraw or send to others.

Venezuelan users reporting that Coinbase is showing this message when attempting to withdraw or send crypto.

With no official explanation from Coinbase, Twitter users wasted no time weighing in on possible reasons for the issue.

Jill Carson, a cryptocurrency influencer, and advisor suggest this conclusion goes too far - pointing out that only about 60 Venezuelan nationals are prohibited from transacting with US citizens.

Instead, Carson surmised the Venezuela government's controversial, oil-backed 'Petro' cryptocurrency is the culprit.

The Petro, a crypto-asset whereby each token represents a barrel of the nation's substantial oil reserves, has attracted widespread disdain from US Congress - who frame the digital asset as a thinly-veiled attempt to circumvent their government's targeted sanctions against Venezuela.

We are concerned that a cryptocurrency could provide Maduro a mechanism by which to make payments to foreign lenders and bondholders in the United States, actions that would clearly thwart the intent of U.S.-imposed sanctions.

By disabling the transfer of cryptocurrencies - and their possible conversion to Petro tokens - Coinbase would indeed be complying with the Trump administration's 2018 executive order, which explicitly forbids the purchase of Venezuelan state assets.

An explanation by Armstrong may address some of the questions about the cause of the issue, but the Petro will likely remain in the line of fire until full functionality resumes for Venezuelan Coinbase users.