Mining unit stands out! Venezuela's 61st Army Brigade establishes digital asset production center, creating "untouchable" income

Against the backdrop of long-term economic sanctions imposed by the United States, Venezuela continues to maintain an open attitude towards cryptocurrencies, using them to evade US restrictions. In addition to actively controlling all domestic mining activities, the military units have even established a "Digital Asset Production Center" to generate additional off-budget income through Bitcoin mining.

National Mining Center

According to a video released by the 61st Brigade on social media, the military in Venezuela has not only established a digital asset production center but also invested heavily in manpower, purchased professional mining machines (ASIC), and graphics card mining machines to participate in Bitcoin mining.

El @EJB_613BING celebra lanzamiento del proyecto tecnológico de la @61brigada para el Ejército Bolivariano por parte de su Comandante @lening, innagurando el Centro de Producción de Activos Digitales con la anuencia de @DHernandezL2020 Comandante General del Ejército Bolivariano pic.twitter.com/LvDwnPJRJg

— 613 Batallón de Acondicionamiento de Ingenieros (@EJB_613BING) November 17, 2020

In the video, General Lenin Herrera of the brigade introduced the mining operations of the center, stating:

The goal of the mining operation is to strengthen the self-sufficiency of the army units. Through mining, they can create a source of income that is not subject to any interference or restrictions, thus avoiding the strong financial trade blockade imposed by the United States.

Monitoring All Domestic Mining Activities

In fact, Venezuela has long sought to break free from the economic sanctions and capital control measures imposed by the United States using cryptocurrency. Previously, the country's president, Nicolas Maduro, issued the oil-backed cryptocurrency "Petro" and made efforts to promote widespread adoption, but it did not bring any utility to the country's weakened economy.

Furthermore, corruption among senior Venezuelan officials is rampant. The official in charge of the Petro project, Ramirez Camacho, has been wanted, and the U.S. Immigration and Customs Enforcement (ICE) in a document in June of this yearstated that he is on the most-wanted list with a five million dollar reward, for violations of the International Emergency Economic Powers Act and suspicion of drug trafficking.

In September of this year, according to the local media outlet CriptoNoticias'sreport, the Superintendency of Cryptoassets and Related Activities (SUNACRIP) indicated that Venezuela will fully legalize mining activities, but miners must register and join the national mining pool.

This is a positive development for cryptocurrency regulation, but it could potentially become a tool for the Venezuelan government to exploit domestic miners. The report also points out that the authorities will be fully responsible for profit-sharing among miners, and there is a high possibility that the government will impose taxes, delay payments, or even freeze funds before profit-sharing.

According to previous reports, Venezuela has a considerable number of miners globally, ranking tenth in Bitcoin hash rate after Norway. Its main advantage lies in its low electricity costs. A study by Elite Fixtures in 2018 also indicated that Venezuela has the lowest cost for Bitcoin mining, but the intervention of a corrupt regime will be the biggest instability factor for the country's mining industry.