Biden’s handpicked banker declares war on digital freedom.
The Debankings Will Continue Until Sovereignty Improves
An independent alternative to financial repression.
After Silicon Valley Bank failed, President Biden told Americans they “can rest assured that our banking system is safe. Your deposits are safe.” Yet, for many, it is increasingly clear that this is not the case.
Across the Western world, banks are unsafe for those holding views that diverge from state-approved media narratives. Banks routinely close accounts of depositors with views that diverge from the accepted narrative, often without notice, a practice called “debanking.”
Even a cursory review of recent debanking incidents makes it clear that conservatives and conservative groups are disproportionately affected. And the advent of a cashless economy fueled by central bank digital currencies (CBDC) will exacerbate this trend. With CBDCs, governments will be able to directly control access to financial services.
Though it has accelerated, debanking is not uniquely American, nor is it new. Across the West, digitized banking has resulted in a top-down politicization of financial services, enabling the debanking of individuals and large enterprises.
A decade ago, the Obama Administration’s “Operation Choke Point” pressured banks to cease relationships with businesses perceived to hold unacceptable ideological views. The trend has only picked up steam since then.
Last year, the Canadian government famously used emergency powers to freeze accounts and seize the assets of a group of truckers protesting vaccine mandates.
British politician Nigel Farage recently made headlines when Coutts, a private bank founded in the seventeenth century, decided to close his account even though he had been a customer for over 40 years. The bank decided, in private memos, that their account holder was a “disingenuous grifter” and that there could be “reputational” harms in continuing their relationship with him.
Farage used his media influence to wage a public relations battle against Coutts and its parent company NatWest, the CEO of which was forced to resign—not for terminating Farage’s account, but for revealing client details to a reporter. In any case, regular people don’t have the ability to draw public attention to the problem of debanking.
Are financial apps any better? Unfortunately, no. PayPal and other payment providers regularly shut down the accounts of customers who engage in wrongthink—demonstrating how hard it is to access any financial services once you have been blacklisted.
Making matters worse, calls for a “cashless society” and the introduction of central bank digital currencies will streamline the government’s ability to control access to finance. We’ve already seen the state work behind the scenes to control what you are allowed to read and hear; imagine if the woke controllers get to decide if you can buy groceries this month.
Once money takes the form of a CBDC, it becomes fully programmable, allowing governments to decide what purchases can be made with it. Money can even be given an expiration date to incentivize spending and penalize savers. As economist Jonathan Newman put it, “programmable money means programmable citizens.”
A group of state-level officials is calling on banks to change their practices. Florida Governor Ron DeSantis and some Republicans have enacted anti-CBDC legislation, but their work would not stop implementation at the federal level.
Americans can restore their sovereignty from banks and their allies by owning a decentralized cryptocurrency like Bitcoin. When you own Bitcoin, you remove a portion of your finances from the discriminatory banking system, and hold repressive institutions accountable by forcing them to compete with an alternative.
Today, Bitcoin, the best known cryptocurrency, is commonly associated with speculation in the West. But in countries with unstable or unreliable currencies, it is seen as a way to gain independence from corrupt financial systems. This use case for crypto will become increasingly important with the advent of CBDCs.
As a digital bearer asset, Bitcoin grants the holder independent control, similar to physical-bearer assets like gold or bonds.
Previously, individuals had to use third-party payment rails to transact digitally, allowing banks or governments to stop or reverse transactions. Now, anyone can use Bitcoin (or other cryptocurrencies) to store and transfer wealth without an intermediary’s permission.
It is important to note that not all cryptocurrencies are created equal. Iris scanning schemes like Sam Altman’s Worldcoin or Sam Bankman-Fried’s FTT token are not decentralized. Their creators or governing bodies are susceptible to government pressure.
When you own a digital asset independent from the banking system, you own a hedge against the threat of being debanked. Bitcoin eliminates the ability of banks to freeze all of your wealth and the ability to transact.
With CBDCs on the horizon, a presidential administration that views the banking system as a political weapon, and with banks happy to comply, it is past time for Americans to understand that Bitcoin deserves a place in their toolkit for resisting tyranny.
The American Mind presents a range of perspectives. Views are writers’ own and do not necessarily represent those of The Claremont Institute.
The American Mind is a publication of the Claremont Institute, a non-profit 501(c)(3) organization, dedicated to restoring the principles of the American Founding to their rightful, preeminent authority in our national life. Interested in supporting our work? Gifts to the Claremont Institute are tax-deductible.