Bitcoin Efforts Launched For Lebanon Amid Financial Crisis – Trustnodes

Bitcoin Efforts Launched For Lebanon Amid Financial Crisis

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Lebanon protests, Nov 2019

Lebanon is on the verge of collapse with the parliament speaker comparing it to the Titanic.

The central bank there has apparently engaged in what Nasser Saidi, a former central bank vice governor, has called a ponzi scheme because it relied on fresh borrowing to pay back debt.

The Lebanese pound is pegged to the dollar, but insufficient inflows led to financial engineering where the central bank borrowed some $85 billion from commercial banks, twice the level of its foreign exchange reserves.

In effect the country is technically bankrupt, so the previous government announced harsh austerity measures, courting a massive on-going revolt.

Reports suggest there are shouts of revolution, with protestors demanding economic reform and secular civil democracy to end the sectarian system.

Fearing haircuts depositors tried to withdraw their money, but banks apparently had informal capital controls, leading to abuse and intimidation of staff.

That staff is now on strike, although there are suggestions they may return back to work on Monday.

The Union of Arab Banks has promised help, but only if Lebanon can form a stable government. It appears a contender for Prime Minister has now withdrawn, so whether they can any time soon remains in question.

Amid this ongoing crisis, Bitcoin du Liban has been launched to inform the Lebanese of potential bitcoin use cases in this sort of situation.

Whether that is having any effect is not clear, with Lebanon a very small country of just $56 billion in GDP, but this two months long uprising has now spread to Iran where they burned down a national bank.

Copyrights Trustnodes.com

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