It's not news that the banks do not like cryptocurrencies and everything that comes with it and the reasons behind this are quite understandable.
If a product of technology was going to put me out of business, I would hate it too.
Cryptocurrencies being designed to facilitate peer-to-peer borderless payments means that intermediaries in traditional finance, whose primary role is to enable money to move from point A to point B, become useless because transactions don't need to be settled via a centralized layer.
This core feature is what makes crypto borderless and out of the control of not just the banks but governments. Technically speaking, the technology is so flexible that you couldn't attack it unless you're ready to attack major sectors in an economy.
By this we are primarily looking at attacks on the energy sector and major privacy violations. Why?
It's simple. There's the energy intensive crypto assets and there's those that aren't energy intensive. To attack the former, you have to go after the energy sector and for the later, you have to go after individual privacy because the way you get to know who's involved with it is to directly invade individual spaces and plant surveillance.
Are there really any governments willing to go that far? Maybe a few could be willing, but when it's only a few doing this, that just drives away businesses and people to places that are friendlier.
Not a win situation at the end because their actions create an incentive others can capitalize on.
To circle back to the banks. We are dealing with a situation where these institutions that are threatened by crypto tech have to use the leverage they still have — dominating liquidity through global wealth custody, essentially being the only value on-ramp sources for crypto — to stop or slow the growth of the industry.
Trump administration mulls ‘debanking’ executive order: WSJ
US President Donald Trump’s administration is reportedly considering an executive order aimed at preventing banks from cutting off services to politically unfavorable industries, including cryptocurrency firms, according to a Tuesday report from The Wall Street Journal, citing unnamed sources.
The move would come in response to allegations that some banks have denied services to tech and crypto entrepreneurs as part of a coordinated debanking campaign critics have dubbed “Operation Chokepoint 2.0.”
At least 30 technology and cryptocurrency founders were reportedly denied access to banking services during the administration of former President Joe Biden. — Cointelegraph report
The choice of words, “Chokepoint” for instance, is really apt. A denial of service based on political reasons, as anyone should know, is an attack on individuals and businesses.
Without reasonable cause, this is grounds for a discrimination suit but of course, these things can prove useless at the end of the day, so what really matters is how to quickly neutralize the threats these institutions pose as liquidity custodians.
Stories like this reveal the urgency and need for finance to go on-chain, completely. Institutions should not be able to deny individuals or businesses critical services due to political reasons or anything else.
Imagine what the world would be like if this remained a thing and we became vastly digitally integrated. That a cashless economy is now a reality, CBDCs gain adoptions, so everyone is now essentially trapped in a centralized system that can make and break them at will.
This is a world we can't live in and a reason to accelerate development of decentralized solutions that affords all people freedom from traditional finance.
Posted Using INLEO
