The position of Venezuelan gold, currently held by the Bank of England, could be in regulatory trouble following the dissolution of Juan Guaido's interim government. The 31 tons of gold have been the subject of contention between current President Nicolás Maduro and Juan Guaido since Guaido integrated a parallel government in 2019.
Status of Venezuelan gold uncertain at Bank of England
The status of Venezuelan coffers kept in a Bank of England vault in London following the dissolution of Venezuela's interim government is unknown. The 31 tonnes of gold (1.02 million troy ounces), worth more than $1.85 billion, are disputed by the country's two governments, one presided over by Nicolás Maduro and the other by interim President Juan Guaidó, who consolidated the interim government in 2019 , after questions were raised about the legitimacy of the presidential election.
While a British court ruled in favor of Guaidó in July, the dissolution of the government, enforced at a session of the 2015 elected legislative assembly, has cast doubt on the future of the gold and other Venezuelan offshore holdings, which some lawmakers have claimed could be forged. Maduro opened the door for them to effectively demand these.
Deputy Freddy Guevara hinted at this possibility during the meeting. He said:
There was no prior consultation with the international community on the recognition of this reform. They have clearly told us abroad that this reform does not guarantee the protection of foreign assets. How could it be possible to leap into the void?
Seventy-two MPs voted for the dissolution of the interim government, 29 opposed and eight abstained.
While the interim government was dissolved, a parallel legislative assembly formed a board of directors and an asset protection committee tasked with protecting and organizing Venezuelan properties and companies abroad. A five-member board would have sufficient powers to handle those responsibilities, backed by the legitimacy of the General Assembly.
However, the structure is new and has not appeared in any of the 52 trials around the world in which more than $40 billion has been disputed between the two governments. Deputy Juan Miguel Matthews criticized the idea, saying the assets were not at risk because they were held by a government that supports the “democratic struggle” that the Venezuelan people are currently waging.
However, this has drawn harsh criticism from other representatives, who argue that, given Guaido's international approval, the interim government is the only guarantee that the assets will be recovered.
How do you see the future of the 31 tonnes of Venezuelan gold held in the UK? Tell us in the comments section below.
Sergio is a cryptocurrency journalist based in Venezuela. He describes himself as a latecomer, entering the crypto space in December 2017 when prices were rising. With a background in computer engineering, living in Venezuela, and affected by the cryptocurrency boom on a societal level, he offers a different perspective on crypto's success and how it helps the unbanked and underserved.
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