Bitcoin: Reflections on the Lebanese Financial Crisis

Why do the Lebanese people suddenly care about Bitcoin?

Long story short, decades of government corruption and questionable policies by the Central Bank have led to a situation where depositors are not able to withdraw their money.

Small businesses are closing down, larger businesses are halving their workforces and salaries. All economic life has ceased while citizens wait for the ruling political class to come up with a solution which has so far been as timely as Godot.

To learn more about the Lebanese financial crisis, the below tweetstorm is the best summary I’ve read so far.

While in the United States, Bitcoin is a luxury investment technology, I will make the case that Bitcoin has an urgent use case as a savings technology in countries facing financial crises like Lebanon.

There is understandably an extreme amount of anger and grief directed towards our big opaque institutions. Why was it the case that the value of our savings was coupled to the decisions of our politicians and Central Bank? (Hint: This wasn’t the case during the Gold Standard)

What is Bitcoin?

Coming up with lucid arguments as to how exactly Bitcoin fixes a problem can become a hand-wavy exercise. I predict that Bitcoin will gain mass adoption in Lebanon in 2020 so it’s important that Lebanese citizens understand the technology and its implications

What’s lost is lost, Bitcoin won’t help you withdraw your money but it’ll make sure no-one is ever able to confiscate your money ever again.

My goal for this post is to equip you with the right arguments to have more productive discussions about Bitcoin with your Mom, Teta and besties. You’re going to be sitting with them over a Turkey dinner, mourning the loss of your monopoly dollars while you blame yourself for not seeing it coming.

Bitcoin is not just an alternative form of money, Bitcoin makes the entire business of Banks and Central Banks obsolete by separating the state from money.

No inflation, No interest rates

This means that contrary to all other modern inflationary currencies, Bitcoin is deflationary as in it increases in value over time as opposed to decreasing.

To counteract the inflation of cash, you’re often encouraged to deposit your money in banks where in Lebanon you can get up to 15% interest. In the US you would instead put your money in the stock market. It’s all good as long as the money is coming in until someday the effects of poor past decisions by the government and private companies add up to you losing significant part of your savings.

Bitcoin is not for speculators, Bitcoin is for those that cringe at the idea of debt, Bitcoin is for savers.

Easy money transfer

You don’t need a bank for local digital payments

You don’t need western union for international payments.

Making payments in Bitcoin is as easy as sending a message on Whatsapp. Pick a recipient and amount and you’re done!

Is it too new?

30 years ago we could not have conceived how big of a part the internet plays in our lives and what kinds of new opportunities it could open up.

Many people reading this article have probably already seen the world around them change so much, why does money get a special status?

Aren’t Bitcoin transactions anonymous? How will we punish criminals?

Bitcoin would expose the true large scale criminals in our society but we may be disappointed to see that they’re all elected officials.

How can you use Bitcoin to save money if it’s volatile?

As of December 2019, a single Bitcoin is worth over $7K so as an investment Bitcoin is the single most successful company of all time and it doesn’t have a CEO or employees.

Volatility isn’t inherently bad, volatility is bad if you’re choosing to quickly spend or cash out on your Bitcoin. If however, you’re willing to patiently hold your Bitcoin then your upside is massive. Satoshi theorized that a single coin could be worth $2M, there is no other investment or stock out there that can promise a multi million dollar return from a 7K investment.

Bitcoin incentivizes saving money.

Consider that your bank account is also volatile because there is always a risk of you not getting your deposits but the risk isn’t transparent to you. At least the Bitcoin network is always transparent about the actual value of your savings.

How will I get used to it?

But the real point is that before you invest in Bitcoin you need to educate yourself on Bitcoin and why it’s so special.

The fastest way to understand why Bitcoin is such a big deal is to read the Bitcoin Standard by Saifedean Ammous which is a thorough introduction to the history of money. It goes over the many advantages Gold had over paper money and presents Bitcoin as the first technology which stays true to and improves on Gold.

If you’re being entirely honest with yourself, before the financial crisis happened, did you really understand how money, banks and central banks work?

It’s not easy but it’s important to educate yourself on money because losing all your money is a big deal. You already spent so much time earning your money, why not spend a weekend learning how money works?

Isn’t Bitcoin used by criminals?

In fact, almost every single major technological breakthrough was met initially by resistance which seems ridiculous in retrospect.

AC Electricity→ Deadly technology because it’s used in electric chairs

Internet → Breeding ground for pornography and fake news

Bitcoin → Anarchy and Starvation

Criminals are often early adopters because their business involves lots of risk already and they are more than willing to experiment with new technology to stack the odds in their favor. That doesn’t mean that technology is bad.

Who controls Bitcoin?

While it does sound weird it is entirely possible to have distributed networks that outperform their centralized alternatives. Torrents are an example which outcompete streaming services like Netflix were they not made illegal.

Stores don’t accept Bitcoin

There is a growing number of people in Lebanon that would prefer to be paid in Bitcoin over US dollars because the dollar is also inflationary. Grocery stores and ABC are likely to follow as they will also want to decouple the money they’ll need to pay their suppliers from the banking system.

How do I buy Bitcoin?

As of December 2019 the easiest way to buy Bitcoin is to purchase it directly in cash from a close friend that lives abroad.

How could Bitcoin fail?

Bitcoin incentivizes cooperation.

Parting note

To this day media companies belittle social media and the internet as an unreliable cesspool of fake news. We know this is false because there is no way we could have orchestrated a large scale peaceful demonstration without the internet. Financial institutions are far more powerful than the media and will resist far more violently to Bitcoin because there is far more at stake. The upside for the Lebanese citizen is however unbounded.


I wouldn’t understand the Lebanese financial crisis if it wasn’t for the NERDS group on Twitter and the Project Diaspora Discord group. They gave me a warm peer group with an abundance of explanations and humor and are the one positive thing that’s come out of the Lebanese financial crisis.

I’m forever grateful.



Robots will save us

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store