Banks are quick to label Bitcoin the money of criminals. But banks fines since the financial crisis have totaled over $243 billion. Bitcoin fines? Zero. Isn’t it time for society to open its eyes?
Banks Don’t Want to Work with Cryptocurrency Companies
I tried to make a small purchase from a well-known cryptocurrency exchange earlier this week. The action was immediately blocked and I had to call my bank over possible fraud. They kept me on hold for 11 minutes. By the time I had liberated my card, I no longer had time to carry out the transaction.
This is one story in countless others from small-time cryptocurrency users and individual Bitcoin HODLers. The plight of cryptocurrency companies trying to open bank accounts is much, much worse.
Take Lamassu, the world’s oldest manufacturer of Bitcoin ATMs. After one year of being unbanked, the company finally upped sticks and moved to Switzerland where they were at last granted access to a bank account. Again, their story is the tip of the iceberg.
Why won’t banks work with cryptocurrency companies? Most point to lack of regulation and lax AML controls. But with $243 billion in fines over questionable dirty money practices in just one decade, it would seem that banks, not cryptocurrency companies, are the enablers of illicit financial flows.
Bank fines since 2008: $243B
Crypto market cap: $134B
Which one is used for illegal activities again?
— Dan Hedl (@danheld) March 10, 2019
Bitcoin ‘Charlatans’ Over Corrupt Banks Any Day
Warren Buffett’s views on Bitcoin are well-known. It’s a scam, a ‘delusion’, a space packed with con-artists, ‘charlatans’, and money launderers. If ever there were a clearer case of the pot calling the kettle black, it would be the world’s most famous investor.
Wells Fargo (a Buffett investment) has been fined a mind-boggling total of 93 times for fraudulent activities and other abuses since the turn of the century. How many fines has Bitcoin received? Zero.
Wells Fargo, a Buffett investment, has been fined 93 times for fraud and other abuses, for a total of $14.8 billion in fines since just 2000
I'll take bitcoin's "charlatans" over that any day https://t.co/9OZkzxgQ7x
— Barry Silbert (@barrysilbert) March 9, 2019
Big Banks Are Often the Perpetrators of Criminal Activity
Not only have large banks found themselves in hot water over the years for their inadequate AML procedures. They’ve also been found guilty of laundering the money themselves.
According to calculations by Bloomberg, Deutsche Bank has paid out close to $18 billion in the last decade alone in AML fines. The bank also had its offices raided in November 2018 on suspicion of laundering a massive $200 billion of dirty money.
Yet, they won’t allow Bitcoin ATM makers and other genuine cryptocurrency companies to open accounts? Isn’t that a little hypocritical?
Just a little… Yet it also shows the size of the profit doesn’t outweigh the risk involved.
Bitcoin Isn’t Big Enough Yet
So if big bank fines topped $243 billion over 10 years, why do they keep acting this way?
Because the profits they make from these activities far outweigh the sting from the fines. AML fines are a mere fraction of the billions of dollars more made from enabling criminal transactions.
The same cannot be said for small cryptocurrency companies. As Dan Hedl pointed out, the entire cryptocurrency market cap is worth just $134 billion, dwarfed by AML fines alone. Most banks simply realize the risk isn’t worth the reward.
That’s one theory. Another is that banks are simply trying to crush innovation and suppress Bitcoin and other cryptocurrencies because they see them as a threat. Let’s not forget the very reason Bitcoin was born in the first place.
With numbers like this, it can’t be too long before society opens its eyes and realizes who the real charlatans are.
Can a more honest monetary system be established using Bitcoin? Share your thoughts below!
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