Canada Triggers A New Trend
Ever since Canada recently began freezing bank accounts, financial censorship has been on the rise. I know geo-blocking is by no means something new but it is definitely experiencing a surge and especially among large Crypto entities. As recently mentioned, Bitcoin was designed so as not to be politicized and yet we are experiencing censorship to some degree taking place on third-party platforms such as exchanges and other common services which offer Crypto options for payment.
Legal regulation is an understandable move for governments and the SEC to pursue but censorship is another story altogether. As I mentioned in my recent post, “DEXs Losing Supremacy As Regulation Tightens”, PancakeSwap will begin geo-blocking 10 different jurisdictions, including Iran. This is unfortunate for the citizens of these countries. This is also the case for the citizens of Russia and Ukraine. They are victims and held captive by the decisions of their respective governments.
This was the motivation behind Satoshi’s invention. Bitcoin was designed to be free of political and banking influence. It was designed to be permissionless and bring an end to financial exclusion. No system or design is perfect it seems and we are about to experience how resilient Bitcoin really is in the face of adversity and stringent government rulings.
More and more exchanges are being forced to make account restrictions based on the instructions of governments. There is definitely a tightening taking place that is simultaneously excluding many from financial services. So, what happens if your “amazing” homeland does something tomorrow to upset the apple cart? You could also face exclusion from certain services. This is the sudden reality that many ignore, simply because it has not yet affected them.
I have seen some exchanges stating that they won’t simply “blanket ban” users from certain regions. We will have to wait and see how this statement ages because centralized exchanges have been forced to adjust their operational criteria quite significantly in recent months.
China Doubling Down
For instance, China takes its ban another step further and forbids citizens from even trading in Cryptocurrencies. If trading is your profession, you would be jobless and without income and financial access overnight. These are very real and extreme circumstances that could affect many in the blink of an eye.
Financial Censorship Promoting Real Estate
This is where serious Cryptoneurs are being drawn to Crypto-friendly locations. Before things go south, they are choosing to position themselves in the most friendly jurisdictions. This subsequently becomes a serious marketing campaign for property in El Salvador, Portugal, and other countries. Trying to stay ahead of the game and maintaining financial access is becoming a much-needed necessity in this ever-changing world. Many will have no choice but to relocate, and where will they go?
Obviously, they will choose the Crypto “havens”, where they can transact and operate freely. This is already happening on a larger scale than many may realize.
The Rules Are Changing
It’s not so much a case of remaining compliant but more a case of reckless countries destroying your compliance by their actions. Anyone who is blocked from a financial service due to geo-blocking is not blocked based on anything they have done but rather what their country has done. Governments are put in place to raise their people up and not exclude them from basic services.
Geo-blocking is evidence of a failed government or regime and those who can leave, will.