After imposing several restrictions on withdrawals and transfers, banks in Lebanon have imposed another new and crazy rule. Those who have deposited or saving accounts in foreign currency like dollar or euro, for example, are only allowed to withdraw this money in Pound, the Lebanese local currency.
But this is not the worst thing. In order to withdraw their money people are forced to exchange their foreign currencies with rates lower than 40% from the rates in the open market.
An article published by Aljazeera reports many stories of people devastated by these rules imposed by the banks and how they are moving what is left from their money into bitcoin.
“Suddenly everything turns upside down and all the options are open,” says one of the interviewers.
Image: Mohamed Azakir/Reuters
In Lebanon, the monetary system has failed and trust in the banks is the lowest historically. Riots have spread in the country against corruption and unfair monetary policies. Every day more people are embracing Bitcoin as a way to avoid the banking system.
Before the bank restrictions, bitcoin was not very popular among the Lebanese people. This is because the central bank in Lebanon restricted cryptocurrency purchases by credit or debit cards.
However, banks can not restrict peer to peer transactions and seem that recently people in Lebanon are being organized in Whatsapp groups to arrange meetings in person in order to buy bitcoins with cash or buy and sell goods in exchange of bitcoin or other cryptocurrencies.
In an attempt to restrict the use of bitcoin banks in reality are helping the mass adoption. If someone is able to take out his money from such a banking system it is not probable that he will ever deposit money in the bank.
In Germany, people are escaping from negative interest rates and if this continues we will see a boom in the vault demand and security companies. And of course, bitcoin will also be an option
Anyway, we crypto enthusiasts do not think that banks will go completely out of business. They will find their small niche in this world just like horses and carriages ride tourists in Central Park.