Crypto Neobank Wallbit Leaves Venezuela Due to Sanctions

Wallbit, a crypto-enabled neobank, announced it would stop serving users in Venezuela after its banking partner in the U.S. called on it to do so. The platform announced this move was the direct result of the economic sanctions that the country is currently facing, and that Venezuelans outside the country would continue to be served.

Wallbit to Cut Service to Venezuelan Users

Wallbit, a cryptocurrency-enabled neobank, that advertised itself as being able to open bank accounts for its users in the U.S., announced it will stop service to users who reside in Venezuela.

The platform issued a press release on February 24, clarifying that its banking associates were calling for the closing of all accounts opened by Venezuelan users residing in Venezuela, telling these users to withdraw their funds as quickly as possible, even as Wallbit did not indicate a date at which these accounts would be terminated.

The company clarified that Venezuelan users living abroad would be still able to use its services, but that they should contact company support in this situation. The situation might affect Venezuelan freelancers that use the platform to collect their wages abroad and convert them to crypto.

Another Platform Closes Due to Sanctions

Wallbit clarified that the reason for this abrupt decision is directly related to the sanctions that the government of the U.S. is currently exerting against some Venezuelan nationals and state companies in the country. In its press release, the company declared:

We would like to clarify that this account closure has its cause in the sanctions that the U.S. government has on Venezuela, so we have the duty of disabling the creation of new accounts, and disallowing new deposits coming from accounts created by users residing in Venezuela.

This is not the first financial platform to cut ties with Venezuelan users due to the risk of being hit by sanctions. In June, Uphold, a New York-based cryptocurrency exchange and investment platform, announced it was also closing the accounts of Venezuelan users due to the “increasing complexity of complying with U.S. sanctions.”

In a similar way, Paxful, a P2P cryptocurrency exchange, announced in 2020 it would cease to offer its services in the country. At the time, the platform cited “concerns regarding the regulatory landscape around Venezuela and Paxful’s own risk tolerance” as the main cause behind this decision.

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