Coinbase co-founder’s Venezuela oil bet could ripple into crypto

Fred Ehrsam, who was a co-founder of Coinbase and is still a member of the board of Coinbase, has spent long months of his life living in one of the hotels of Caracas while dealing with the oil business in Venezuela. Ehrsam’s investment vehicle, called Primavera, has recently signed a production-sharing contract with PDVSA, which is the major producer of oil in Venezuela, The Wall Street Journal (WSJ) reported on September 10.

It’s unusual for a 38-year-old without experience in the oil and gas sector to take such a step. But the idea is not new: to find a challenging but proven investment opportunity with possibly huge returns. In addition, Ehrsam is a member of the President’s Council of Advisors on Science and Technology.

For cryptocurrency investors, another aspect of the situation could prove to be more significant. In case Venezuela starts substantial oil production, such events will have an impact on crude prices as well as inflation and monetary policy—the same macro forces that affect liquidity and appetite for Bitcoin and Ether.

What Ehrsam is actually chasing in the Orinoco Belt

Ehrsam has been seeking control of at least three fields in the Orinoco Belt, home to the world’s largest concentration of extra-heavy crude. Earlier reports said his targets included fields operated by Alvorada Heavy Industries.

The latest WSJ reporting confirms that Primavera has secured production-sharing contracts with PDVSA, although the eventual size of its operating footprint remains unclear.

Why does Venezuela pull foreign money in

Why is Venezuela such a looked-after country in terms of oil production? It’s simple — size. The U.S. Energy Information Administration has estimated Venezuela’s crude oil reserves to be around 303 billion barrels as of 2023. This makes it the country with the highest amount of oil reserves in the world.

However, oil production in the country in 2023 was only around 783,000 barrels a day (bpd). This increased to 1.12 million bpd by July 2026, as estimated by the International Energy Agency (IEA).

The U.S. is also contributing to reshaping what the investment space looks like. North American Blue Energy Partners received rights to 17 fields comprising over 65 billion barrels of reserves, while the U.S. government acquired a 35% stake in the company. According to a later analysis by the Columbia Center on Global Energy Policy, PDVSA characterized the contract as 25 years with the option to extend it, rather than as a 100-year concession.

Chevron is moving faster. The company plans to invest more than $7 billion over five years and more than double its Venezuelan production to around 600,000 bpd.

Why the bet could take a decade to pay off

The resource base is not the main problem. Execution is.

According to Rystad Energy, Venezuela’s crude production will likely grow by about 17% or 194,000 bpd from late 2025 to late 2028, mostly from existing fields.

“Execution, not geology, remains the key constraint.” — Rystad Energy

However, the outlook of Rystad Energy for a longer period looks much more cautious as significant new production in Orinoco is expected only around 2035.

“Expectations that significantly more oil from Venezuela will reach the market within just a few months are likely to be disappointed.” — Commerzbank

The risk should also be understood in the context of legal uncertainties. It is reported by OPIS that Commerzbank has raised questions about the legality of the deal, whereas Columbia has pointed out that the arrangement may be implemented more to protect the investors rather than Venezuela itself.

The feedback loop back into crypto

The connection between oil prices and cryptocurrencies cannot be traced to just one crude price point. In this case, the link is not anchored to the price of crude oil but issues like rising energy prices, which, in turn, can affect inflation and monetary policy.

According to the Federal Reserve’s research, a 10% increase in oil prices can raise the Consumer Price Index (CPI) by a total of almost 0.4%. In April 2026, Governor of the Federal Reserve Christopher Waller said the increase of Brent crude from $61 at the beginning of the year to approximately $95 was accompanied by an increase in the energy CPI of over 10.8% and the headline inflation of 3.3%.

Importantly, an increase in the Venezuelan supply will not necessarily mean an increase in Bitcoin and Ether prices. However, it might lead to reduced oil-driven inflation and reduce pressures on interest rates and other risk assets in the financial market. In the case of new supply disruptions, the situation will change dramatically.

Venezuela is already deeply connected to the crypto economy. Chainalysis estimated $44.6 billion in Venezuelan crypto transaction flows in 2025 and documented crypto’s dual role as both a household financial lifeline and a tool used in sanctions-linked oil trade.

This situation not only explains why Ehrsam’s transition is more than an unexpected shift from the cryptocurrency sector to the oil industry. Should Primavera succeed in converting the reserves of Venezuela into a sizeable output, the impact will ultimately be felt in energy cost, inflation, and global liquidity, exactly the same factors that facilitated the growth of the business that brought genuine riches to Ehrsam.

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