The US special forces raid on Venezuela, which captured President Maduro, has sent shockwaves through international political and financial markets. The event has led to expectations of increased oil supply, resulting in a slight short-term rise in oil prices, but a potential long-term decline. Cryptocurrency has become a focal point of geopolitical competition, with stablecoins facing the risk of being frozen, increasing the attractiveness of decentralized assets. The US may strengthen sanctions against crypto channels, intensifying compliance pressures on the industry. Meanwhile, the rising issue of energy security indirectly impacts the deployment of AI computing infrastructure.
Article author and source: Charlie Little Sun, the fur-trimmed lion of Sand Hill Road
Hello everyone, welcome to 2026. It's been a long time since our first episode, and we've had a chance to chat with you all.
So, our plan for the new year is to better integrate this blog and our WeChat official account. For the past year, our official account has mainly focused on content related to blockchain and cryptocurrencies, and we will continue in that direction in the new year.
The new year has started in a very interesting way.
A highly shocking incident occurred over the weekend, and this incident is very closely related to my previous professional experience. As many of you may know, the Venezuelan president was captured unexpectedly and swiftly by US special forces and brought to the United States . Today, Monday, US time, the trial has begun in court.
This entire event has had a significant impact on the Latin American market, and even on the international political situation and financial markets. Because when I was at Franklin Templeton, I was responsible for the Latin American market. Although I wasn't directly involved in investments in Venezuela, the markets I covered, such as Colombia and Chile, were very relevant. Colombia, for example, was also affected to some extent in this event, which I will discuss later.
The incident happened very suddenly, in the early hours of Saturday, January 3rd. The U.S. Delta Force launched a surprise attack on Caracas, the capital of Venezuela, capturing President Maduro and his wife.
Operation Absolute Resolve began around 2:00 AM. The US military launched airstrikes on many key targets in Caracas, and images of US helicopters flying at low altitudes have been widely circulated online.
Shockingly, there was no resistance whatsoever. Delta Force swiftly apprehended Maduro and his wife and escorted them out of the country by helicopter and transport plane. Trump also posted a very famous photo on social media: Maduro blindfolded, holding a bottle of water from Costco, and wearing Nike clothing. This photo went viral across all social media platforms.
Let's start with a "brief overview": Why it's so noteworthy
Why is it so noteworthy? There are several reasons. I'll start with a brief overview, our baseline scenario, and a general analysis of some tail risks. Then, I'll elaborate on specific aspects such as international politics, US politics, capital markets, and even blockchain, among others.
Overall:
It was not authorized by the United Nations. This unilateral military action is a major subversion of the international norms we now recognize, and therefore has triggered a great reaction.
We can see that it wasn't just Venezuelan soldiers who suffered casualties; civilians were also killed or wounded. Furthermore, given the very close relationship between Venezuela and Cuba, many Cuban advisors also perished in this operation.
Trump had already charged Maduro with "drug terrorism" during his first term. The main charge he faces today in a US court after his arrest is the same. In the American narrative, this charge is presented as a legal act, but everyone knows that drug terrorism is just a pretext; the real underlying issues are energy and oil.
This "surgical enforcement" was swift, but most countries condemned the military action, which was not approved by the Security Council. This sets a very, very dangerous precedent. If the United States has the capability to act this way, then no head of state is truly safe.
We can see that most of America's allies have used carefully chosen language and have not directly criticized the US. However, we can see that major powers like China and Russia, as well as Latin American countries like Brazil and Mexico, have strongly condemned the US for blatantly violating their sovereignty.
We recall the last time the United States did something like this was around 1989 when it invaded Panama. It can be said that this was the most dramatic and forceful intervention by the US military in Latin America since that military operation.
So, especially given the current chaotic international situation, this has caused a significant shock. Many regimes are starting to worry: will we be next? The media is talking about it, for example, Iran—because Iran has also recently experienced a lot of domestic unrest.
This includes the current high-profile relations between major powers: will the relationship between the United States and China/Russia become more tense? In fact, actions of this magnitude have transcended the scope of so-called "Latin American and American news"; they are a global news event. Although everyone has been talking about the Monroe Doctrine and the idea that "America is America for Americans," this event does indeed have international and global implications.
Baseline scenario: Political transition has begun
Overall, I believe there is a baseline scenario for how this situation is developing.
We are now seeing Venezuela begin the process of political transition. Following Maduro's capture, Vice President Delcy Rodríguez temporarily took control of the capital and received support from the military. Today, we see media reports in the US stating that Rodríguez has begun cooperating with Washington.
Interestingly, the United States did not directly support the current opposition in Venezuela to come to power, but rather cooperated with the current vice president. We can see that the vice president is a so-called technocrat with good execution capabilities, so establishing a transitional government is actually a reasonable course of action.
I think the fundamental shifts that followed were: opening up the oil industry and cracking down on drug trafficking. These are probably the two most important directions.
Today we see a Reuters report: Chevron's operations in Venezuela, which had been suspended for several days, have begun to resume. One photo shows a Chevron oil tanker departing Venezuela. This indicates a relatively smooth transition in the oil industry and suggests that cooperation between the caretaker government and the United States is progressing relatively smoothly.
Of course, the US military also faces the threat of further military strikes, as the military strikes in this blitzkrieg were relatively limited, targeting only some key objectives. The next steps, such as lifting the oil export ban, further opening the Venezuelan oil market to more US oil companies, and cooperating with US anti-drug operations, are all likely to occur next.
Market reaction: Betting on "controllable risks"
The market reaction largely reflects this baseline scenario.
For example, oil prices rose only slightly, with Brent crude increasing by about 1.5% to 1.6%. The stock market was also not significantly affected, experiencing only a slight increase.
Investors generally believe that although Venezuela has enormous reserves, its production is limited due to limited industrial capacity and its closed-door policy to international oil companies, meaning its output accounts for only about 1% of global production—a very small percentage. With the new government in power and the easing of US sanctions, Venezuelan crude oil supply is likely to increase, thus preventing oil prices from rising significantly.
This also shows that investors currently perceive this as a very manageable risk: the market may believe that the US action will be limited to Venezuela and unlikely to trigger a wider conflict. Although many countries have expressed concern about the US's next move, which we will discuss later.
Tail risk: Low probability, but really dangerous.
In addition to the baseline risk, there is also tail risk. Although it is of low probability, we can imagine some extreme cases occurring.
If the situation worsens:
First, what if China and Russia take asymmetric retaliatory actions—even if not a direct confrontation with the US military, such as launching cyberattacks, supporting proxy states to counter the US, or using this as a pretext to do similar things to smaller countries elsewhere? For example, if the US can arrest people, then what if we could do the same to countries that threaten us…? For example, if Putin were to actually arrest Zelensky. These things are not entirely impossible.
The second potentially dangerous factor is Iran. If Iran is drawn into the conflict, its oil production far exceeds that of Venezuela. Located at the heart of the Middle East, Iran is a powder keg ready to explode at any moment. If Iran were to join forces with Venezuela against the United States at this time, a conflict in the Gulf region could disrupt the Strait of Hormuz, a vital waterway for 20% of global oil transport. In that case, oil prices wouldn't just see a slight increase of 1.5%, but could surge, triggering a global energy crisis.
Inflation could surge, significantly impacting economic growth and potentially triggering a global recession—both are highly probable scenarios. Such a black swan event would cause immense turmoil in global markets and politics.
Therefore, the baseline scenario is relatively optimistic and calm, and may even be optimistic for the capital market and the crypto market; however, tail risks still exist, and we will continue to monitor them.
Crypto: Geopolitics is using crypto-financial infrastructure as a weapon and a battlefield
Beyond the macroeconomic situation, when discussing the cryptocurrency ecosystem, we can see that this event demonstrates how geopolitics has turned crypto-financial infrastructure into a weapon and a battlefield.
Why do I say this? Because Venezuela's actions in the field of encryption in recent years are a very interesting case of the game between large and small countries.
Under constant pressure from US sanctions, the Maduro regime has actually developed a set of "crypto survival skills" in the cryptocurrency field. For example, it uses Tether's USDT to circumvent US financial sanctions. Reports indicate that since 2024, Venezuela has even allowed foreign buyers to use USDT to pay for oil purchases.
In Venezuela, we know that inflation is very high, import and export controls are strict, and the currency is heavily controlled. Many businesses and individuals use cryptocurrency as a daily transaction tool to buy necessities. We have seen some data suggesting that by 2025, 10% of retail transactions will be completed through cryptocurrency; and approximately 9% of remittances nationwide will use crypto channels.
Therefore, amidst the US financial blockade, cryptocurrency has become a pillar of Venezuela's shadow economy—somewhat like Argentina and other countries with severe inflation and currency control: stablecoins have played the role of "dollar substitutes."
Now that the United States has spearheaded this transformation, we will see that the crypto economy, which runs parallel to the traditional banking system, will face a severe test.
The US began pushing for stablecoin legislation and a so-called "co-opting" of Venezuela last year, accelerating the development of these crypto channels. Through OFAC sanctions and other means, it may blacklist more wallet addresses and monetary services related to Venezuela.
If you follow the US-compliant stablecoin route, the issuer has the right to freeze your address; compliant exchanges are also hesitant to handle these funds. Venezuelan-related accounts pose a significant risk: if found to be linked to the Maduro government or sanctioned entities, they may be locked and frozen. We've also seen Tether and Circle have the ability to freeze stablecoin addresses. Exchanges may temporarily block access from Venezuelan IP addresses, or even freeze local withdrawals, introducing stricter regulations.
Even Petro, the "petro-based cryptocurrency" issued by the Venezuelan government in 2018, may be more thoroughly removed from shelves/isolated.
This is not good news for ordinary Venezuelan users. At my previous startup, our design team leader lived in Venezuela and had a strong need to receive salaries in stablecoins. If businesspeople and citizens start using stablecoins for payments, won't they worry that their USDT will become "black market" currency, or that it's linked to the government or sanctioned addresses?
As soon as the news broke, rumors circulated that USDT was immediately sold at a discount in local over-the-counter markets, for example, at a discount of $0.95 – for fear that the coins would be locked in wallets. Although this is mostly speculation, it is enough to illustrate the panic.
If everyone rushes to exchange potentially "tainted" stablecoins for other assets, could this lead to increased demand for cryptocurrencies like Bitcoin, Ethereum, and Solana, which are not subject to centralized issuance and cannot be frozen at will? It's possible.
Therefore, while the use of crypto in Venezuela may decline in the short term, we will gradually see a shift: from freezeable stablecoins to more decentralized, non-freezeable mainstream cryptocurrencies.
This also serves as a warning for other emerging markets: in Argentina, Nigeria, Kenya, and elsewhere, people use crypto as a hedge against local currency devaluation and financial instability. In the future, they will be more concerned about: Can the US exercise extraterritorial jurisdiction to freeze stablecoins? Will exchanges suspend accounts at any time? They may turn to more decentralized cryptocurrencies and decentralized exchanges.
Overall, this incident has pushed the crypto financial pipeline to the forefront of geopolitical competition: it may lead to a greater split in the crypto world—on one side are stablecoins that have taken a compliant approach of "co-opting and cleaning up" the crypto market; on the other side is the decentralized, offshore, gray-market crypto asset camp.
Regulatory oversight will continue to tighten, plugging loopholes that hostile regimes might use to evade sanctions through encryption. Anti-money laundering and anti-fraud measures will become more stringent. Ordinary people are more concerned about traditional finance and centralized encryption, and are instead relying more on decentralized assets to protect their wealth.
Geopolitical risks for cryptography: a double-edged sword
From the perspective of international order, the impact of encryption is two-way.
On the one hand, in an atmosphere of "who will be next," decentralized, censorship-resistant assets (such as Bitcoin) are becoming increasingly attractive. People in high-risk regimes—the wealthy and high-ranking officials—may quietly transfer their wealth from stablecoins to Bitcoin or privacy coins, moving them outside the banking system, in order to prevent their assets from being frozen by traditional finance.
There are indeed rumors that Venezuelan officials have been accumulating a shadow reserve of Bitcoin in recent years, converting some of their oil revenue into cryptocurrency reserves. Information suggests that the Maduro regime has amassed up to 600,000 Bitcoins since 2018 through gold and oil transactions, and the confiscation of mining farms. This figure is high and remains to be verified, but it is enough to suggest that the possibility of Bitcoin serving as a secret national wealth repository is not unfounded. Similarly, sanctioned countries such as Russia and Iran are also exploring using cryptocurrency to circumvent the dollar system.
From an investment perspective, investors might believe that these regions will see a surge in BTC/ETH purchases as a safe haven, thereby driving up the price. Today's slight increase in Bitcoin's price suggests that this line of thinking is being partially accepted.
Rising geopolitical risks will increase long-term demand for crypto assets, and the story of "digital gold" will be repeatedly brought up—especially when the real world is insecure.
On the other hand, short-term geopolitical shocks can also negatively impact the crypto market. When risk aversion is triggered, investors often sell off high-risk assets first. Historically, when sudden conflicts trigger financial panics, Bitcoin prices tend to plummet along with the stock market, unlike gold which tends to rise.
For example, when the Russia-Ukraine war broke out in 2022 and oil prices soared, Bitcoin experienced a sharp drop. In the panic, funds flowed into traditional safe-haven assets such as the US dollar, US Treasury bonds, and gold. The narrative of "digital gold" did not hold true in the early stages of the crisis—at least in the early stages, Bitcoin was more like a high-risk "digital Nasdaq."
Therefore, if the worst-case scenario we mentioned earlier occurs (e.g., escalating conflict, soaring oil prices), Bitcoin may fall rather than rise.
Meanwhile, during periods of heightened tension, countries tend to tighten controls on capital flows to prevent capital flight: banning the buying and selling of cryptocurrencies and imposing stricter regulations on VPNs. As Western countries advance stablecoin legislation, they also become more vigilant against hostile nations using cryptocurrencies for fundraising or money laundering, freezing addresses at the slightest sign of trouble.
This is not good news for the increasingly formalized crypto business: compliant exchanges and wallet service providers are forced to strengthen monitoring, compliance costs are rising, and user experience is deteriorating. Industry development will be slowed down.
In summary, when the international order is disrupted, encryption will have a contradictory double-edged sword effect: on the one hand, it strengthens the narrative of "safe haven"; on the other hand, it gives countries more reasons to weaponize the financial system and strictly control encryption channels.
Sanctions and Compliance: Encryption is a Key Part of the US Congress's Efforts to "Patch the Loopholes"
This incident highlights the central role of sanctions in US strategy while also exposing loopholes in traditional sanctions. The US will use this opportunity to take remedial action, and the crypto space is a previously relatively neglected area.
For a long time, the United States has imposed severe economic sanctions on Venezuela, Iran, Russia, and other countries, which these regimes have tried every means to evade. Taking Venezuela as an example, the Maduro government has managed to hold out until now largely by exploiting loopholes in the sanctions system, and cryptocurrency is one of the key loopholes.
Following Maduro's arrest, the US will likely conduct extensive internal intelligence research to determine how he can maintain financial resources under sanctions. This could prompt the US to strengthen sanctions against cryptocurrencies.
Unsurprisingly, they will discover a wealth of evidence: how Venezuelan officials or their frontmen used cryptocurrencies and stablecoins for transactions; how PDVSA used USDT to bypass banking regulations; how brokers helped businesses convert bolivars into USDT for import procurement; and who the counterparties were and what the channels were. Then the US will close these loopholes one by one.
What we may see next is the OFAC sanctions list gradually expanding, adding a batch of cryptocurrency wallet addresses linked to Venezuela, and even those linked to countries like Iran. More wallets will be frozen—especially those of government officials and related institutions, as well as addresses involved in illicit oil trade.
In the process of patching up the loopholes, dollar-denominated stablecoins will stand out more: the US will pressure stablecoin issuers to implement geo-fencing or more targeted freezes, restricting Venezuelan users and offshore accounts, and freezing addresses associated with crime.
If this happens, large amounts of USDT in the national treasury will be passively affected, resulting in a significant blow. The liquidity of USDT on the black market will plummet, and the USDT held by ordinary people will be divided into "clean" and "dirty" currencies. Clean currencies are those not associated with sanctioned funds; dirty currencies will trigger panic, discounted selling, and reduced trading. There may even be a situation of "one currency, two prices": USDT will be sold at a significant discount locally, greatly reducing the purchasing power of ordinary people.
This "clean/dirty" divide may not only remain within stablecoins but will also permeate DeFi and offshore exchanges: platforms will strengthen geographical and address restrictions, unwilling to serve blacklisted users to avoid trouble with the United States.
Even more challenging is the issue of funds from sanctioned addresses mixed into DeFi pools. These funds become unwithdrawable "dead money," impacting pool exchange rates and causing headaches for protocol governance. Will DeFi protocols refuse to accept collateral from certain addresses? How is connection to sanctioned entities determined? Should assets be frozen? These questions create a conflict between the ideal of "decentralized governance" and practical compliance.
Many DeFi project core teams, fearing lawsuits, may ultimately compromise with compliance to protect themselves. If major DeFi protocols all incorporate compliance filters, the DeFi ecosystem will split into "clean DeFi" and "underground DeFi": compliant institutional funds will enter the market, but the commitment to privacy and borderlessness will weaken; the underground sector will adhere to censorship resistance principles, but its scale may shrink, existing in a "guerrilla" form.
Regardless, compliance costs will rise significantly for global crypto companies: they will need to invest more resources in monitoring on-chain activity and cooperating with investigations. On-chain monitoring and data analytics companies may benefit; smaller companies will struggle, and some small projects will exit the market. Industry concentration will increase, innovation will slow, and the decentralized principle will be undermined.
In conclusion, this event has a profound impact on the crypto ecosystem in terms of compliance and sanctions. Venezuela serves as an example of a loophole in sanctions, which the US will gradually tighten. The crypto space may be facing a round of "purges": cleaning up those exploited by authoritarian regimes, leading to short-term turmoil and liquidity contraction; in the long term, a new form will emerge—cleaner entities will be more integrated into mainstream finance, while non-compliant entities will remain hidden in the gray area. Ordinary users need to be especially careful: a single misstep could result in frozen assets or restricted trading.
Unfortunately, in the context of great power rivalry, "Code is law" must give way: the true law remains state power. The crypto world will be reshaped by real-world powers.
Energy: Mild in the short term, but may put downward pressure on oil prices in the long term (baseline scenario)
Now let's talk about the elephants in the room: oil and natural gas. Venezuela, after all, has the world's largest oil reserves, although its production has accounted for less than 1% of the global total in recent years. However, the regime change has had a profound impact on oil and gas and even shipping.
In the short term, the market perceives the crisis as relatively minor: Brent crude rose slightly by 1.5%, with investors not overly concerned about supply disruptions. The departure of Chevron oil tankers from Venezuela, along with other indications, suggests a low risk of oil field shutdowns or port blockades. Production has not been damaged; in fact, many believe that after a change of regime, the US may lift the ban on Venezuelan oil, opening up more opportunities for companies (US/Europe) to invest in exploration and refining, leading to increased future supply and preventing oil prices from soaring.
Unless a worse scenario unfolds—such as a caretaker government losing control of the remaining forces and resorting to a "scorched earth" policy—bombing refineries and damaging pipelines (the repair of these facilities would take time and would substantially impact the oil market), or a military conflict disrupting tanker transport—the scenario would present a stark contrast to the baseline.
Medium- to long-term benchmark: If the transition is successful, the US lifts some sanctions, and international oil companies return to invest, production will increase, global supply will rise, and oil prices will actually fall. However, this is an ideal scenario, and it requires stabilization and time (it may take two to three years to see results).
Based on short-term and medium-to-long-term assessments: oil prices will see a slight increase in the short term but a decline in the long term, which is favorable for inflation; the central bank has more room for easing, which is favorable for risk assets.
Gold, Silver, and Volatility: Safe-haven buying, but no panic.
Investors' instinctive reactions to major geopolitical events are twofold: first, a surge into gold, silver, and US Treasury bonds; and second, increased volatility due to uncertainty.
This time was no exception: gold rose significantly, and stocks also rose (though not dramatically). Safe-haven assets rose while risk assets rose, because investors believed the crisis had a limited impact on the global economy, was merely a localized event, and would not affect overall risk appetite.
The VIX hasn't risen much, remaining in the teens; the crude oil volatility index has also risen moderately. In other words, a minority are cautious, but the majority remain relatively optimistic.
Macro: The benchmark is almost unaffected; the tail will turn sharply downward.
Further systematic review of macroeconomics: interest rates, the strength of the US dollar, credit risk in emerging markets, and global liquidity.
Macroeconomic background at the beginning of 2026: The central bank raised interest rates to combat inflation. Now inflation is slowing down and growth is weak. Monetary policy is nearing a turning point - interest rates will either remain high or begin to decline, as evidenced by the Fed's interest rate cuts.
Will events in Latin America alter the macroeconomic landscape? In the baseline scenario, the situation is largely unaffected, or even more relaxed: stable conditions, cooperative new governments, a smooth transition, and the easing of US sanctions reduce global uncertainty, allowing investors to focus on fundamentals. This year may see a more accommodative monetary environment, with crypto assets often performing better.
However, if tail risks materialize (such as unrest in the Middle East or a surge in oil prices), the macroeconomy will deteriorate rapidly: inflation expectations will rise, central banks will adopt a more hawkish stance, interest rate hike expectations will resurface, and global liquidity will tighten. Risk aversion will push up the US dollar and US Treasury yields, severely impacting cryptocurrencies. Emerging market interest rate differentials will soar, capital outflows will occur, currencies will depreciate, and a chain reaction of debt crises will trigger a decline in risk assets across the board.
In short, the macroeconomic impact depends on how the situation develops.
AI and Energy: Rising energy security priorities will indirectly impact computing infrastructure.
Finally, let's discuss a more practical topic: Venezuela is related to energy, and energy is closely linked to AI.
The event itself is not directly related to the AI industry, but its indirect impact is that if it triggers a wider energy crisis or policy adjustments, countries will re-examine energy allocation, affecting investment in AI infrastructure.
On the first level: Geopolitical conflicts lead to energy supply shortages and soaring electricity prices, and countries may take extraordinary measures to ensure power supply to key sectors; in extreme cases, energy-intensive but non-critical industries may be sacrificed to ensure people's livelihoods. AI is important, but it may also become a casualty in extreme cases—perhaps slightly ahead of crypto mining, but when power distribution is truly needed, both crypto computing power and AI may temporarily give way.
From another perspective: the event has prompted a greater global focus on energy security, forcing countries to invest in energy independence. With Venezuela, the country with the world's largest energy reserves, falling under US influence, other countries will re-evaluate their priorities from the perspective of "energy security first," while simultaneously not wanting to fall behind in the AI wave. This leads to a "want-it-all" situation: simultaneously " drilling baby drills" and " building baby builds ," expanding both energy production capacity and computing infrastructure.
In the long run, this is actually beneficial for AI: the construction and training of AI data centers are currently hampered by energy issues. This incident has brought greater emphasis to energy security, and countries will take a more strategic approach to both traditional and new energy sources—amidst the intensifying AI competition between China and the US and the chaotic landscape of great power rivalry, the impact of AI on energy deserves closer observation.
