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Stop Bank Hypocrisy Over Bitcoin

Pierre Noizat
Pierre Noizat

Full time Bitcoin entrepreneur since 2010, coder, Internet of Value evangelist.

This article was first published on Maddyness : read the original article here (en français).
French to English translation from Blockchain.io.

► Visit Paymium.com, Europe’s First Bitcoin Exchange.

Are French banks preventing the development of Bitcoin in our country?

Not long ago, I received an embarrassed call from my corporate banker. He announced the imminent closure of our corporate account, the one used to pay salaries, taxes and rent. No reason was given, because a bank, according to the Monetary and Financial Code, does not need to give reasons for its decision to close a bank account.

Our company is profitable, has no financial issues and has a solid shareholder base. It operates in a dynamic sector with a very promising future. But it’s precisely because of its activity that its account has been closed. What criminal activity can justify such treatment? Quite simply, it is linked to the cryptocurrency industry, of which Bitcoin is the most famous representative.

This anecdote says a lot about the antagonism that opposes in our country the advocates of a monopolistic currency at the service of the financial industry, supported by institutions solely committed to self-preservation and the users of digital currencies whose development can no longer be obstructed.

A fool's game

Who do we really want to protect in France? The official stance of public and banking authorities is caution and service of the "general interest". The governor of the Banque de France, François Villeroy de Galhau, said so publicly: "Bitcoin is not a currency (...) It is a speculative asset." The same message is given by the ECB (European Central Bank) : those who use Bitcoin do it at their own risk.

Yet there are many reasons to doubt these laudable intentions. The cascading defections that Facebook is currently undergoing for the launch of its Libra coin demonstrate the pressure exerted on private operators who would like to venture into the field of cryptocurrencies. On a smaller scale, the experience with our friendly bank clerk also illustrates this open hostility. A casus belli that the giant BNP Paribas even claimed before the fact-finding expert mission of the National Assembly on virtual currencies: "We will not open bank accounts for cryptocurrency businesses until the anti-money laundering directives have been fully transposed and the question of the legal status of cryptocurrencies is settled" (Agefi Hebdo n° 619). Quite amusing when we consider the means deployed by banks and their lobbyists to ensure that the legal status of cryptocurrencies remains uncertain...

This fool's game is remarkable. It is indeed the Monetary and Financial Code - written by bankers for bankers! - that requires a company in the Bitcoin business to have a bank account. The banks' monopoly on money creation is therefore coupled with a monopoly on means of payment thanks to the concept of "legal tender"... Behind the official speeches, we can see the rejection of any form of competition contrary to the general interest! Only "official" money should circulate in the real economy. A paradigm that is increasingly dated because its founding principle - the security of the system - is a shameless lie.

Is " conventional " money really risk-free? The repeated crises that the financial industry is primarily responsible for, every 10 years on average, have far more real and dramatic consequences for the citizens of the world than any supposedly risky alternative. How many jobs lost, how many billions spent by taxpayers to bail out banks following the 2008 crisis? How risk-free is this system? A McKinsey study has just revealed that, today, one bank over three in the world is threatened to close!

A paradigm shift that will take place with or without France

Let's put things in perspective. We are currently living in a period similar to that of the automobile when it emerged as an alternative to travelling in horse-drawn carriages. At the time, opponents pointed out its dangers and the lack of suitable infrastructure (unpaved roads, no petrol pumps...). But what do we see today? Cryptocurrency infrastructures are emerging, in particular "wallets" and exchange platforms. The latter are essential for maintaining the liquidity of these new currencies. France is rather ahead of the game on these issues. But if the legislator does not create space for experimentation nor infrastructures, then innovation will massively go elsewhere. And there's no point in hiding the fact: cryptocurrencies are a paradigm shift that lobbies will no longer be able to stall. Because this change does not concern the old dollar or the fragile euro: it is just global!

Today, leaders in the field of cryptocurrencies are located in Asia and the United States. They handle trading volumes of several hundred million euros per day, with withdrawal limits of 25,000 euros per day and 200,000 euros per month. In France, within an equivalent scope of controls, banks impose limits of 10,000 euros... for the lifetime of the account! French banks are therefore knowingly preventing the development of national flagships at the expense of the general interest. They even go as far as contacting Bitcoin buyers to dissuade them from investing further.

In fact, it is urgent that the legislator ratifies in the law the end of the money creation monopoly attributed to credit institutions alone; it must recognize the validity of a payment with a decentralized currency; and must finally give value as evidence to an electronic signature recorded in the Bitcoin public blockchain.

These measures would make it possible to free up a source of jobs and energy that is currently restricted by the banking monopoly. There can be no true political democracy or entrepreneurial freedom, its corollary, without monetary democracy.

Pierre Noizat is an engineer, graduate of Polytechnique, founder of Blockchain.io and Paymium.

This article was first published on Maddyness : read the original article here (en français).
French to English translation from Blockchain.io.

► Visit Paymium.com, Europe’s First Bitcoin Exchange.

Pierre Noizat
Pierre Noizat

Full time Bitcoin entrepreneur since 2010, coder, Internet of Value evangelist.

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