Bitcoin miners vs. Sunacrip: a legal battle is about to take place in Venezuela

Mining Bitcoin in Venezuela is legal.

Key facts:
  • The legal team of Sierramoros CA affirms that it is ready to fight for the right to property.

  • Sunacrip takes the measures it considers appropriate for miners without a license.

A legal battle related to Bitcoin (BTC) is approaching in Venezuela. Sierramoros, the company that owns the Bitcoin miners that were confiscated in November of last year, would move all its legal resources to confront the National Superintendency of Cryptoactives (Sunacrip), an entity that confiscated the equipment alleging non-compliance with Venezuelan regulations.

This was announced to CriptoNoticias by lawyer Carlos Marín Santeliz, a member of the legal team of Sierramoros CA, the company from which dozens of Bitcoin miners were confiscated in November. According to the lawyer, the company he represents “will fight for its right to property.”

The lawyer maintains that the seizure measure taken by Sunacrip represents a violation of the presumption of innocence and good faith, which are constitutional rights in Venezuelain addition to the right to property, according to Marín Santeliz.

That is why the defenders of Sierramoros CA plan to go – prior authorization from the management – ​​before the Constitutional Chamber of the Supreme Court of Justice (TSJ) to appeal the sentence.

It must be remembered that in November of last year the First National Contentious Administrative Court of Caracas ruled in favor of the miners, this after Sunacrip confiscated a batch of equipment alleging that they operated without licenses. Sierramoros had filed an amparo that favored them.

Subsequently, Sunacrip took the case to the TSJ which, in March of this year, annulled the ruling in favor of the miners and confirmed the confiscation of the equipment. The TSJ remarked the power of Sunacrip to decide on issues that have to do with Bitcoin and its ecosystem.

According to the lawyer, the legal team of the accused company has not been formally notified about that decisionwhich revoked the previous ruling issued by one of the Capital District courts, which ruled in favor of Sierramoros CA, as reported by this newspaper.

Mining Bitcoin in Venezuela is legal.
Mining Bitcoin in Venezuela is legal, but if regulations are not followed, equipment can be seized. Source: Bitcoin Paraguay.

“I have not even bothered to study the decision well because I have not been notified,” said Marín Santeliz in an exclusive interview with this medium. “By reading it, it is made known that constitutional rights are being violated and that would allow us to go before the Constitutional Chamber of the Supreme Court of Justice to be able to dismantle the accusations,” he added.

It must be remembered that in Venezuela the new authorities of the Supreme Court of Justice are about to be appointed, something that is in process, although with delay. Marín Santeliz indicated that surely the appeal would coincide with the arrival of new judges and magistrates to the Judiciary.

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Bitcoin miners vs. Sunacrip: a legal battle is about to take place in Venezuela

“The most drastic measures”

According to the Constituent Decree on the Comprehensive Cryptoactive System, approved in Venezuela A couple of years ago, there were preventive sanctioning measures for those who found themselves mining cryptocurrencies without prior permits and licenses, established by Sunacrip.

In its article 37, the legislation states that, if during a Sunacrip audit indications of non-compliance with the established obligations are detected, at least three measures could be taken: suspension of licenses (if any), sanctions provided for in the current legal system (which is at the discretion of Sunacrip) and the confiscation of equipment.

The latter, in the words of Marín Santeliz, It is one of the “most drastic” measures taken by the government entityviolating, in his opinion, the principle of proportionality, which refers to the possibility of applying sanctions according to the infraction committed.

If mining is done without a license, various measures can be taken, but Sunacrip takes the most drastic measures at once and that violates the principle of proportionality. What they apply the most, for the most part, is the confiscation of equipment. Although there are cases where, selectively, they apply the disconnection.

Carlos Marín Santeliz, lawyer from Sierramoros CA

In any case, Santeliz warns that since Bitcoin miners can be subject to confiscation, the logical thing is that recidivism weighs on the machines. That is to say: a fine is imposed for the first time and anyone who is operating without a license is alerted. If you don’t comply, they end up confiscating your equipment. “But that doesn’t happen that way,” lamented the lawyer.

Although the lawyer admits that the Sierramoros CA company was mining without a license, he affirms that the corresponding paperwork was already being carried out, so he warned of a whole “personal plot” behind this story.

In fact, that company has had an interest in mining for years. In 2018, the CEO of Sierramoros CA, Marco Salcedo, raised the request for a loan to Banco Bicentenario, related to the Venezuelan government, for the import of Bitcoin miners.

That was through an alliance with the Black First Investment Fund, where he showed his interest in “acquiring miners and hosting them on our farms,” ​​as Salcedo commented at the time.

Supreme Court of Justice of Venezuela
The case of the miners seized by Sunacrip from the Sierramoros company rests in the Supreme Court of Justice of Venezuela. Source: Cepaz.

Where are the confiscated Bitcoin miners?

Marín Santeliz was unable to clarify the current whereabouts of the confiscated mining machinery, although he stressed that, in accordance with the law, should be in the custody of Sunacripwhich was the entity that confiscated them.

This is what the Decree establishes: “When the confiscation measure is ordered on the mining equipment, the Superintendency will safeguard the respective assets, which, if the measure is final, may be disposed of for social purposes through a reasoned act, which to such effect signed by the Superintendent”.

But in the records that were drawn up during the inspection, the place of shelter or custody of the miners was not established. Given this, CriptoNoticias turned to people with knowledge of the case to obtain more information, and, although they offered details, the sources preferred to remain anonymous.

They explained to us that the mining equipment would be protected by Sunacrip, in more detail in a department of the buildinglocated in Caracas, under the order that they not be touched by anyone, due to the legal case still in progress.

To confirm the whereabouts of the equipment, CriptoNoticias requested comments from a lawyer, a member of Sunacrip’s legal team, but we did not get answers.

According to the judgment of the Supreme Court of Justice, the confiscated equipment was 12 Bitmain Antminer S19 Pro; 1,624 Ebang E9Is and at least 1,475 power supplies. These pieces of equipment were seized at the Data Center Soco SA mining farm, in Aragua state, in the center of the country.

Although there was confiscation in another plant, controlled by Tecnominado SA, in Caracas, the truth is that there is no clarity on the number of teams that were taken by Sunacrip at that time.

Confiscated SIERRAMOROS CA equipment is under the protection of SUNACRIP.
A source from CriptoNoticias affirms that the confiscated SIERRAMOROS CA equipment is under the protection of SUNACRIP at its headquarters in Caracas. Source: VTV.

A source from CriptoNoticias affirms that the equipment confiscated from Sierramoros CA is under the protection of Sunacrip at its headquarters in Caracas. / Photo: VTV.

This legal battle at the door between the miners and the Venezuelan authority, will seek to unlock a case that has already been going on for at least five months in that country, where the complexity of carrying out –regularly– Bitcoin mining in Venezuela has become evident, ironically, a profitable place to carry out the activity.

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