Venezuelan President Nicolás Maduro denied his guilt in the New York court on charges of drug terrorism this week. The news came just five days after the United States arrested him at the presidential palace in Caracas.

The broader landscape of digital assets has highlighted the dual nature of cryptocurrencies. Borderless and immediate transactions offer life-saving opportunities for those whose banking systems do not function. However, the same features also enable illicit financing and circumvention of sanctions.

How did U.S. courts gain jurisdiction over Maduro

Reactions range from cautious hope for a change of power to anger over U.S. intervention. The case against Maduro is now advancing in the United States.

Initially, the question arose as to whether Maduro could be prosecuted in the U.S. due to the circumstances of his detention. Ari Redbord, TRM Labs' policy lead for blockchain tools, clarified the issue.

Redbord, a former federal prosecutor, told BeInCrypto that when the accused is on U.S. soil, U.S. courts have jurisdiction to handle the case under U.S. law.

"U.S. courts have a longstanding Ker-Frisbie doctrine based on two cases. The principle states that federal court jurisdiction over the accused is not limited by how the individual came before the court. Even allegations of abduction or irregular transfer typically do not prevent prosecution," Redbord stated on the BeInCrypto podcast.

At this moment, the most important focus is on the charges against Maduro and the evidence supporting them.

Evidence behind the drug terrorism charges against Maduro

The indictment alleges that Maduro and Venezuelan top officials have maintained close ties with international drug trafficking networks over the past two decades.

Prosecutors argued that these connections enabled the flow of illegal drugs into the United States and provided financial benefits to those involved.

According to Redbord, the evidence is overwhelming.

"This case differs from a typical drug case due to abuse of authority," Redbord said. "The charges are detailed. They describe how Maduro and his inner circle allowed the use of Venezuela's airspace and maritime routes, enabling cartels to freely conduct drug trafficking."

Since cryptocurrencies are often used for illicit financing, questions have arisen about whether digital assets were used to support the drug terrorism linked to Maduro.

The role of cryptocurrency outside the indictment

The decentralized and borderless nature of cryptocurrencies has made them an attractive tool for criminals seeking to avoid detection or circumvent sanctions.

However, after reviewing the detailed indictment, Redbord told BeInCrypto that there is currently no evidence that Maduro or his inner circle has relied on cryptocurrencies to carry out their operations.

Yet he stated that cryptocurrencies have played a significant role in Venezuela in other ways.

According to TRM Labs' cryptocurrency adoption report, Venezuela ranked 11th globally. A broken banking system, chronic hyperinflation, and strict capital controls have led to widespread use of digital assets.

"For this reason, we see everyday use of cryptocurrencies in Venezuela in ways not yet seen in the United States. In the U.S., it's easy to use credit cards, Venmo, and other payment platforms. In Venezuela, stablecoins can serve as a vital lifeline," Redbord told BeInCrypto.

There have also been state-backed initiatives that, however, have not succeeded.

In 2018, Venezuela launched Petro, a state-backed cryptocurrency tied to oil. It was the first attempt by a government to directly adopt a cryptocurrency as a response to sanctions.

"Maduro was under increasing pressure from the United States and its allies and was seeking ways to bypass dollar-based transfers. Petro failed both commercially and technically, but revealed a strategic shift: the government was experimenting with crypto," Redbord explained.

Although it failed at the governmental level, cryptocurrencies are still used by ordinary Venezuelans in their daily lives.