Greeks Turn To Bitcoin To Dodge Capital Controls

[Ares]

There is at least one legal way to get your euros out of Greece these days, to guard against the prospect that they might be devalued into drachmas: convert them into bitcoin. As Reuters reports, although absolute figures are hard to come by, Greek interest has surged in the online "cryptocurrency", as new customers depositing at least 50 euros with BTCGreece, the only Greece-based bitcoin exchange, open only to Greeks, rose by 400% between May and June.

As Reuters reports,

Using bitcoin could allow Greeks to do one of the things that capital controls were put in place this week to prevent: transfer money out of their bank accounts and, if they wish, out of the country.



"When people are trying to move money out of the country and the state is stopping that from taking place, bitcoin is the only way to move any value," said Adam Vaziri, a board member of the UK Digital Currency Association.



"There aren't any other options unless you buy diamonds, and that's very difficult to move."



But Marinos said the bitcoin buyers' main aim was to shield their money against the prospect that Greece might leave the euro zone and convert all the deposits in Greek banks into a greatly devalued national currency. If voters reject the demands of international creditors in a referendum on Sunday, this becomes much more likely.



"A lot of people are keeping all the bitcoins they buy on our platform, until they understand what to do with them," Marinos said. "In their eyes, now they have bitcoins, they're safe."

* * *

With Bitcoin having surged from $238 to $268 in the last few days since Greek PM Tsipras announced Greferendum, it is clear it's not just the Greeks that are losing faith in faith-based fiat currencies.

http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/07/20150703_BTC_0.jpg

Ironically, on June 20, Greece got its first bitcoin "ATM", in a family-run bookstore in Acharnes on the outskirts of Athens.

http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2015/07/20150703_BTC1.jpg

http://www.zerohedge.com/news/2015-07-03/greeks-turn-bitcoin-dodge-capital-controls

[EE_]

PayPal no longer works in Greece—and why that matters
Shelly Banjo
OBSESSION

Future of Finance
July 02, 2015
This post has been updated.

Adding to their list of woes, Greeks can no longer use their PayPal accounts.

Limits on how much money Greeks can take out of banks put in place by their debt-stricken government as it negotiates with lenders have effectively crippled the online payment service, which relies on traditional banks and credit cards to transfer money.

According to a PayPal spokesman:
Due to the recent decisions of the Greek authorities on capital controls, funding of PayPal wallet from Greek bank accounts, as well as cross-border transactions, funded by any cards or bank accounts are currently not available. We aim to continue serving our valued customers in Greece in full, as we have for over a decade.

The economic crisis in Greece is obviously not emblematic of the greater global financial system. But the fact that PayPal’s business has ground to a halt there underscores how much it and other financial technology companies are reliant on the traditional institutions they were created to disrupt.

The truth is, there’s an old-fashioned bank at the heart of nearly every financial startup meant to put the old guard out of business.

Take online peer-to-peer lenders Lending Club and Prosper—neither of those companies actually holds loans on their balance sheets. Instead, it’s a Salt Lake City, Utah, bank called WebBank that issues most of those loans.

Likewise, Coinbase, the hot bitcoin wallet startup that lets people buy and store bitcoin, relies on Silicon Valley Bank in Santa Clara, California, to transfer bitcoin into US dollars and other fiat currencies. (Coinbase did opportunistically offer to waive transaction fees for all people buying bitcoin with Euros this week in an attempt to convince people of what they said were the benefits “of using a global currency that is not controlled by any particular country or company.”)

So while many of these startups present much-needed competition to the traditional financial system, PayPal’s shutdown in Greece reminds us how difficult it is to disintermediate banks from the flow of money.

Update (July 3, 2015): PayPal said some services, including receiving payments, remain available in Greece. However, funding PayPal wallets from Greek bank accounts, cross-border transactions, and certain payment attempts remain unavailable for now.
http://qz.com/444188/paypal-no-longer-works-in-greece-and-why-that-matters/

[Serpo]

So who needs a bank............guess we now know why the banksters are very worried...........they have become surplus to requirements..........