Welcome, and thank you for being part of the MyZucoins community! Dive into some important crypto, finance, and tech news to stay ahead.
The Great Unbanking: A Dangerous Game
Nigel Farage, the ex-leader of the UK Independence Party and a pivotal figure in the Brexit movement, recently made waves by revealing that his bank accounts had been shut down. Farage contends that this was due to his political beliefs, and that he’d been labeled a “politically exposed person” (PEP) – a term typically reserved for those at high risk of involvement in corruption or blackmail. Despite him failing to open new accounts with seven different banks, his original bank, Coutts, stated that their decision was purely commercial.
Being a PEP, according to a 2015 EU directive, requires banks to carry out particularly stringent checks due to the potential exposure to bribery and corruption. This includes government officials, diplomats, auditors, and more, extending even to their families and close business associates. Banks across the EU, US, and other regions now have access to an international list of PEPs. As a result, most banks find it more cost-effective to close these accounts rather than upgrade their fraud detection mechanisms.
This practice, however, has garnered criticism for its potential overreach and the threat it poses to the integrity of the financial system. It’s also led to fears of a social-credit system akin to China’s, where an individual’s access to services is determined by their ‘score’. Nigel Farage’s situation has already sparked a series of similar claims from high-profile individuals whose accounts have been closed or denied without clear explanation.
The rise of online banking and the automation of account management has further exacerbated the issue, leading to an increasing number of people being placed on PEP blacklists by unaccountable algorithms. As a result, there’s a growing call to curb this Orwellian trend and establish a more balanced system that protects both the integrity of the financial system and the rights of individuals. Read more here.
Since the fallout, to manage the damage prominent figures have resigned and media sources have issued public apologies. However this event uncovered the “reputation systems” that are brewing within the world of finance, seemingly a trend that isn’t slowing down.
New Money, New Rules? A Wake-Up Call
Did you know about a year ago, Nigel Farage and Sam Volkering sat down to discuss “New Money, New Rules”. Their conversation revolved around an unsettling notion: our wealth might not be as secure as we believe. They painted a picture of a future where the traditional financial gatekeepers command and control the financial system. To counteract this, they proposed a solution: new forms of money like Bitcoin, which can provide access to finance and economic participation for those currently excluded.
Their predictions now ring unsettlingly true in the wake of the Coutts Scandal. This incident has underscored the reality that banks can exclude individuals based on their views. It’s a disturbing concept, regardless of one’s opinion of Farage. It underscores the urgency of considering alternative financial tools like Bitcoin to safeguard against such risks.
In July 2022, Farage and Volkering outlined four smart strategies to navigate this monetary shift. These moves aimed to keep individuals ahead of the curve in the face of the most significant change to our money system in centuries. Now, more than ever, it’s worth revisiting their advice.
The Coutts Scandal has laid bare the vulnerabilities of traditional finance. It’s a wake-up call for everyone to realize that the financial system is not immune to biases and exclusions. Having alternatives like Bitcoin, and exploring new financial tools, is more crucial now than ever before. Watch the interview here.
Crypto’s Potential In The “Reputation Based” Future Of The Banking World
The traditional financial system, as exposed by the Coutts Scandal, carries inherent biases and risks. Discriminating based on political beliefs and choices undoubtedly goes against the many constitutional freedoms of most developed nations. The fallout of these increasingly common events will only do one thing—push people to alternatives. Right now, the preferred alternative for a growing number of people is the world of cryptocurrencies.
Commodity-like digital assets such as Bitcoin and Zucoins, are designed to address these very issues. By eliminating the need for a central authority, they aim to decentralize power.
What’s more, Zucoins is solving many of the inherent issues that exist in traditional blockchains. This coverage by Sam Volkering is in many ways telling of what was to come and in parts, did come, when Nigel Farage got “unbanked” earlier this year. Volkering’s been at the forefront at many of these events, which is why Zucoins is so fortunate to have him as an advisor.
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All the best,
Peter & Rob
MyZucoins