Over the past few months, there have been a growing number of cases around the world where old banks have withdrawn their services and support from companies dealing with Bitcoin.
In Bangladesh, the national bank threatened up to 12 years in a very nasty Bangladeshi prison for doing business with or even educating people about Bitcoin.
In the UK, just a day before the Crypto Valley Summit, a number of banks pressured the company that managed Bitcoin accounts to close all accounts associated with Bitcoin. It now appears that Swedish banks also entered into the act.
Gustav Nipe of new technologies today indicated that the Swedish banking system is extremely resistant to new technologies, despite the many problems it has encountered, such as the zero percent interest rate policy, which never saw the light of day.
The low rate it suggests indicates a very slow growing economy. Banks often raise and lower interest rates to stimulate the economy, but the fact that this no longer appears to be a tool available to the Riksbank indicates real problems. Yes interest rates are not lowered this could start to cause a lack of confidence in the banks, which would lead to less lending, which would translate into less business expansion.
The high interest rates of previous years were one of the reasons Bitcoin started to spread in Sweden, as it seemed to be resistant to inflation and its decentralized nature really appealed to Swedes in general.
Finally, the fact that there are no real transmission costs, even for very large transactions, has made it popular with the business community. A simple internet connection allowed customers to make payments without all the documents and fees that usually come with this activity.
But now it seems that the banks arbitrarily close accounts of the dozen Bitcoin companies. A bank, Länsförsäkringar, announced that they did not want customers to use Bitcoin and Nordea closed the accounts by Bitcoinbolag. Then, in response to questions about the reason, the bank announced that it had no obligation to provide a reason.
Speculated nipe that the reason was a simple fear of competition from banks of a decentralized currency because Bitcoin can operate outside the financial system they control:
“We need more entrepreneurs who dare and can develop new payment systems, who are stuck in old ways of thinking. The Riksbank’s statement on introducing a zero interest rate will continue to raise house prices and plunge the economy into a new bubble. The winners are those who speculate healthily and sit down on large loans. Small savers with money in the bank are the losers.
Keeping in mind the actions of other banks around the world, Nipe may actually have a valid point. The point is, for most people, banks are just a safe place to store assets. The problem is that this storage can cost many consumers a large chunk of these assets over time, and bank failures have occurred with increasing regularity over the past century, especially as governments seek more and more. in addition to deregulating the financial sector.
Due to the current unpredictability of the banking system, new paradigms such as Bitcoin can be a real alternative to their monopoly system.
St. Louis Fed Economist David Andolfatto released a presentation on Bitcoin in April 2014 and he seemed to agree that Bitcoin actually posed a threat to central banks, explaining:
“I think its existence as a threat is very good: it will discipline the Fed and other central banks to continue to conduct responsible policies – if they don’t, people might move on. The idea of currency competition: Many countries impose currency controls. In Albania, you would suffer serious consequences if you were caught with US dollars in your pocket. The purpose of currency control is to stimulate demand for national currency, as the central bank and the central government want to exploit the people by inflating excessively, so the threat of monetary competition – if a central bank, a government, knew that the people could stop using national currency and flock to an alternative, which would force the government to behave more responsibly. “
But now we are not only seeing banks denying and closing accounts, causing third parties to discriminate, but also threatening users and businesses with jail terms, as in the case of Bangladesh. So far, none of the countries’ biggest banks have declared open war on Bitcoin, but if the past few months are any indication, there could be real problems on the horizon.
Did you like this article? You may also be interested in reading these: