The best regulated crypto exchange
Find out why?
50 BTC prize pool!
Get your share!
I'm in

Protesters attack Lebanese banks

By Lawrence Gash

Rage-filled scenes follow currency collapse and banking restrictions

The Lebanese capital Beirut has been wracked by a series of angry protests this week as the country’s economic crisis continues.

The protesters engaged in a prolonged standoff in the cosmopolitan city’s bustling centre. Dozens of people have been arrested and a journalist for Reuters was hospitalised by security forces.

While many of the protests were peaceful, some intensified with protesters targeting bank branches, smashing their windows, breaking their security cameras and destroying their ATMs.

A UN official has blamed the country’s out-of-touch political class for increasing popular anger.

A currency crisis has engulfed the Eastern-Mediterranean nation since last autumn. For decades the Lebanese pound (LBP) was pegged to the US dollar (USD). The country’s net-importing economy, which is dependent on steady financial inflows, stagnated throughout 2019.

The Banque du Liban, the Lebanese central bank, further exacerbated the country’s woes by using foreign exchange reserves to maintain the currency peg, resulting in a severe dollar shortage.

In the past fortnight the LBP has fallen 60 per cent in informal markets, despite remaining formally pegged to the dollar. The Banque du Liban pledged in early November not to impose excessive capital controls on citizens and banks, but has since done so.

The Lebanese people have suffered more than the banks, protestors claim. They say the banks have been seizing deposits and restricting ordinary customers from performing certain transactions while not limiting certain politicians or wealthy individuals. A large proportion of lenders are not allowing individuals to withdraw more than $1,000 (£770, €900) per month, even though they have not formally implemented such a policy.

With a currency in freefall, banking restrictions and uncertainty as to who should lead the country out of this political and economic crisis, there has been a small, yet growing turn towards cryptocurrencies.

The decentralised nature of digital assets such as Bitcoin (BTC) and XRP has interested those tired of being shut off from their own money. One of Lebanon’s foremost public intellectuals, the internationally acclaimed writer and trader Nassim Nicholas Taleb, has spoken out against the current system, which he described as a Ponzi scheme.

Having written the foreword to Saifedean Ammous’ popular Bitcoin Standard, Taleb has repeatedly championed the ability of cryptos to liberate individuals from the arbitrary decisions of states.

When the protests first broke out in late-2019, Taleb wrote: “The most potent case for cryptocurrencies: banks are never there when you need them. And they are trying to bully the public, so they avoid accountability and profit disbursements. Bankers are legal crooks.”

FURTHER READING: Two initiatives spotlight push towards digital banking

FURTHER READING: Carlos Ghosn flees to Lebanon

Like to share your thoughts and ideas about crypto and trading? You could join us as an external author. Email us on [email protected] to find out how you could become a Currency.com contributor.
Subscribe to Currency.com news
iMac Image
The most beautiful trading app
google play storeapple store
iPhone Image
iPhone Image