Venezuela blocks Binance in presidential dust-up

When a dictatorship gets into trouble, it is usual for it to react by restricting the freedom of speech, and thus of denunciation, of its opponents. It should therefore come as no surprise the gag placed by Venezuela on social X, formerly Twitter, a rapid tool for spreading news around the world. More surprising, however, is that the same measure was taken against Binance, the world's most popular cryptocurrency exchange.

The Binance Restriction

The alarm came last 9 August, when Binance LatAm, the South American division of the transaction giant, alerted its users - and the whole world - to the existence of a DNS block on the crypto exchange's address, capable of preventing Venezuelan addresses from accessing the site correctly. Confirmation came the following day, the 10th, when, following further testing, Binance posted on its site, and on X, confirmation of the blockade:

"Like many websites of Venezuelan companies from different sectors, including social networks, Binance's pages were subject to access restrictions."

A local organisation opposing censorship, called VE sin Filtro, confirmed the existence of the blockade and broadcast on its channels Binance's communiqués, which otherwise would not have been visible to Venezuelans. From the exchange they immediately informed users in the country that their savings were not at risk and the situation was being monitored from the moment the DNS was discovered.

The Causes of the Block

The Venezuelan government has no problem whatsoever with cryptocurrencies. The blockade of Binance is not due to a desire to prevent their direct purchase, but rather to limit another service offered by the site: the possibility of transferring peer-to-peer money.

This is a popular way of converting money into tokens, which is widely used in Venezuela, since the local currency, the bolivar, is heavily inflated and worth rather little. Turning it into crypto means being able to resell it in the form of an asset that is easier to manage.

According to VE sin Filtro, every Venezuelan involved in the blockade should use a VPN, a virtual private network capable of fooling the network's access point detection. In this way, while physically being in Venezuela, it is possible to surf the network by making the provider believe that one is accessing from another location, thus circumventing local blocks.

The encrypted messaging app Signal was also blocked, for the same reasons.

Binance and the Situation in Venezuela

On 28 July, following the counting, if we can call it that, of the ballot papers, the country's government-controlled electoral authority awarded victory to Nicolas Maduro, with just over 51% of the vote. His challenger, Edmundo Gonzalez, on the other hand, claimed to have obtained more than 70% of the vote and declared himself the winner. The government did not provide official polling data. Many analysts doubt that there were any.

The United States, the United Kingdom, the European Union and several Latin American countries did not recognise Maduro's victory. Binance appears to be yet another victim of the severe censorship of a leader who feels he is slipping in his chair.

Maduro's Declarations

On 9 August, the president of Venezuela - or the loser, depending on how you look at it; we use this term for sheer clarity of exposition - gave a speech to the nation, ordering the Venezuelan telecommunications regulator to ban access to X, from the country, for 10 days. Elon Musk, owner of the former twitter social, took it rather badly. He immediately challenged the politician to a public confrontation. Maduro replied that he is ready to hold it, as soon as the dust settles.

It now remains to be seen whether Binance will also be reopened, for Venezuelan users, on 19 August, at the end of X's 10-day closure. In the meantime, the exchange continues to push its token, BNB, which we focused on a few days ago.

If you want to stay informed, or informed, about this story and others related to Web3 and cryptocurrencies, subscribe to the newsletter from SpazioCrypto.