Lebanon’s banking system has been hit hard by the ongoing economic turmoil and political unrest. Banks across the country closed following nationwide protests against corruption and the increase of taxes. The public debt has reached $86 billion and there are no signs for improvement. President Hariri’s government had plans to impose a tax on WhatsApp calls ignoring the facts that more than two thirds of citizens have family members working abroad and sending money back home.
Hariri has resigned, yet Lebanon is poised to experience further political uncertainty amid his resignation. Banks have set a withdrawal limit of only $1,000 per week for foreign currency accounts to control the flow of money coming in from abroad and ATMs across the country have run out of money. Such instability and lack of trust in political and financial institutions triggers demand for alternatives which would offer immunity from political manipulation and the inability of citizens to access their own finances.
In April 2018, Dr. Husam Yaghi along Dr. Alexander Vasylchenko of Sofitto had proposed to Banque du Liban a blockchain based digital payment system which would tokenize the Lebanese pound and facilitate local trading with digital currency.
The fact is, employing digital assets based on a commonly shared and transparent ledger, users can access their own finances when they need to, free from government control and manipulation. Thus people would have control over their wealth and cryptocurrency could become a go-to financial instrument especially during economic turmoil or political unrest.
No wonder many governments oppose blockchain and cryptocurrency.