Bitfinex "US intervention in Venezuelan oil could be a medium-to-long-term positive for the cryptocurrency market"

An analysis suggests that if U.S. companies begin developing Venezuela's vast oil reserves, electricity costs for the Bitcoin mining industry could fall, improving mining profitability.

On the 6th (local time), Cointelegraph reported that global crypto exchange Bitfinex said in a recent report, "If U.S. companies begin developing Venezuela's vast oil reserves, it would have an immediate ripple effect on the energy market and, secondarily, could affect Bitcoin (BTC) and the broader crypto market," adding, "a drop in oil prices could serve as a short-term buffer in a situation where Bitcoin miners' profitability is under pressure."

This analysis follows U.S. seizures of Venezuelan oil tankers since December last year and the recent arrest of President Nicolás Maduro, which have brought the possibility of Venezuelan oil development back into focus. Venezuela holds one of the world's largest oil reserves—about 303 billion barrels—and among U.S. companies only Chevron is currently conducting limited operations there. President Donald Trump has publicly pushed other major U.S. energy companies to enter Venezuela.

However, the prevailing view is that significant increases in oil production will take considerable time. Bitfinex noted, "Meaningful increases in Venezuelan oil production are a matter of years, not months," adding, "the pace of political transition and sanctions relief is key." Matt Mena, a research strategist at 21Shares, also forecasted, "Restoring Venezuela to its former status as a major oil producer would require more than 10 years and over $100 billion in infrastructure investment."

Venezuela's oil production was about 3.5 million barrels per day in the 1970s, accounting for about 7% of global production, but has plunged to around 1 million barrels per day currently, reducing its global share to roughly 1%. Under the socialist regime, economic collapse led to a sharp decline in the currency's value, and the entire energy industry has undergone a prolonged slump.

Following U.S. intervention, international oil prices showed a slight decline. U.S. benchmark crude (WTI) is about $58 per barrel, roughly 3% lower than its December peak. This could provide limited relief for some Bitcoin miners whose electricity cost structures are influenced by oil prices.

Bitfinex added, however, "Crypto asset prices are more likely to be driven by macro risk appetite, volatility, and shifts in cross-asset positioning than by energy fundamentals," and "the Venezuela factor needs to be interpreted from a medium-to-long-term perspective."