What Would You Do if Your Bank Account were Frozen?

That’s what happened to Russia after its troops invaded the Ukraine. It had roughly $650 billion in foreign exchange reserves parked in banks around the world. After the invasion began, the U.S. central bank and its allies froze Russia’s funds (and its wealthiest individuals) as punishment for its “bad” behavior. Coincidentally, this made Russia’s foreign dollar and euro holdings un-useable to prop up the value of the Ruble. Subsequently, the Ruble dropped precipitously relative to the U.S. dollar making it difficult for anyone holding rubles to purchase things. Imagine what it would be like if your U.S. dollars could only buy 20 cents worth of goods tomorrow! Can you imagine what other countries around the world are thinking about the U.S. government and how it has weaponized the U.S. dollar? How much longer will they want to hold dollars as their reserve currency? Talk about an incentive to find an alternate money!

A similar thing happened recently to some truckers in Canada who were protesting the new laws regarding COVID vaccinations. Their bank accounts and credit cards were frozen. Furthermore, the Canadian government is investigating people who donated money to the truckers’ cause through GoFundMe and GiveSendGo websites. Is it safe to protest in Canada? Is it safe to be a Canadian?

In short, the fiat currencies of the world are now being used as weapons against parties their governments don’t like. This has been made possible, in part, because the money that is in one’s bank account actually belongs to the bank. The moment you deposit it into “your” account, it becomes property of the bank and you have actually lent that money to the bank. And if the bank defaults on your loan…good luck suing the bank without “your” money.

Imagine what it will be like if the governments around the world adopt digital currencies. Any protest against the government can be met with an immediate freezing of the protestor’s bank account and credit cards. If fact, why stop there? Why not freeze or seize all the protestor’s assets…land, house, storage units, anything it can find. And then there are relative’s assets. Talk about familial pressure! The burden will be on the protestor to prove his innocence and get his money back. He may even have to undergo “therapy” to become a “good” citizen. Never mind that he may starve in the meantime.

About the only thing I can think of that one may be able to hide from a government is a crypto asset that is kept in a cold wallet. That’s why Russians and Ukrainians alike are using bitcoin as a lifeline when their fiat currencies lose their purchasing power. Something to think about, eh?

Robert F. Sennholz

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