Source: Adobe/hakase420
Reportedly, Lebanon intends to forcibly convert its foreign currency holdings into its pound (LBP), again establishing a case for Bitcoin (BTC).
Earlier this week, Reuters reported that it had seen a government "master plan" developed to address the ongoing financial crisis. The plan, the news agency wrote, "envisions a XNUMX% depreciation of the Lebanese pound and transforms most of the banking system's hard currency deposits into local currency."
Investors would potentially suffer huge losses if the plan were implemented. Reuters went on to say that "of the €XNUMX billion in hard currency deposits," the plan's authors "plan to return just €XNUMX billion to savers in US dollars, with most of the rest to be transformed into LBP at multiple exchange rates, including one that would wipe out XNUMX% of a few deposits.
And while the government apparently plans to repay "all depositors," it will do so over "a period of fifteen years."
Alex Gladstein, director of strategy for the Human Rights Foundation, lamented that the planet was "watching" "robbing bureaucrats raiding the currency of a once proud nation."
From the bitcoin community, the message was clear and sounded like this: "Bitcoin solves this problem."
Castle Island Ventures associate Nic Carter felt the Lebanon report was "a story as old as time" and could see impostors "cutting their hair off en masse". However, he stated that “it was only a matter of time before crypto-dollarization became the default and robbed these central banks of their primary weapon.”
Podcaster Neil Jacobs shared a video with comments from Mexican millionaire and bitcoin bull Ricardo Salinas Pliego. The latter said:
“Everything we have in fiat is XNUMX% seizable by the government. People do not realize . But it is a fact.
Elsewhere, some commentators added that the best way to prevent states from accessing their checking accounts was to transform their funds into cryptocurrencies that they keep in a hardware wallet.
However, it is not just Lebanese depositors who now live in fear of what the government is going to do with their foreign currency funds.
Nic Carter pointed to the relevance of a January XNUMX report by the Wall Street Journal (WSJ), which explained that Turkish citizens were "hoarding" investments in bitcoin (BTC) and tether (USDT) to escape the "collapse" of the lira.
The WSJ report explained that because "certain" Turks felt the government could "force banks" to convert US dollar deposits into lira, this was "putting pressure on certain to move US dollars held by banks and US dollars Americans in cash" against stablecoins "according to multiple thrifty Turks. The WSJ added that, according to Chainalysis, "more than half of the transactions against the lira in the last month of the year involved tethering."
Cryptocurrency and stablecoin activity has also increased in Argentina, which has been battling hyperinflation for multiple months, prompting the government to curb purchases of US dollars.
Others have argued that the widespread adoption of USDT could lead to the development of "hyper-dollarized" economies.