TL;DR: The refrain, “Not your keys, not your Bitcoin,” can be likewise applied to precious metals, and now especially to the cash-strapped country of Venezuela and its deposed President, Nicolás Maduro. Recently, a judge in the UK denied handing over from the Bank of England (BoE) £820 million worth of the nation’s gold due to a political squabble.
Not Your Vault, Not Your Gold
“The BCV will immediately appeal the absurd and unusual decision of an English court that seeks to deprive the Venezuelan people of the gold, so urgently necessary to face the covid-19 pandemic,” Banco Central de Venezuela protested to Twitter immediately following the UK High Court’s announcement.
“Her Majesty’s Government does recognise Mr Guaidó in the capacity of the constitutional interim president of Venezuela and, it must follow, does not recognise Mr Maduro as the constitutional interim president of Venezuela,” Judge Nigel Teare argued. At issue is nearly $1 billion worth of gold, but its owner is not in dispute. It is Venezuelan gold, and keeping stashes of hard money around the world in legacy institutions such as the BoE is rather commonplace. Other than the US Federal Reserve, its vaults hold most of the world’s supply — some 400,000 bars.
The BoE prides itself on security, often touting more than three centuries of not having had any gold stolen from its possession. Up until very recently, Venezuelan leaders probably believed the nation’s bars were in good hands. The problem for Venezuela is Maduro’s challenge to legitimacy by Juan Guaidó, recognized by countries such as the US and UK last year as the nation’s duly elected President. Guaidó has repeatedly asked the UK not to release the gold, noting its leverage against the Maduro regime in the midst of tightening international sanctions and deep economic woes.
Gold and access to it is an ongoing issue for Venezuela. For at least that last two years the Maduro regime appealed to the BoE fruitlessly. At the end of May 2020, the BCV published its latest appraisal of the matter in England, insisting it needed the gold, “which will be invested, with the direct support of the United Nations, in the purchase of medicines, food and medical teams, to deal with Covid -19 in the country.”
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