With institutional banks declaring war on Bitcoin, it’s worth familiarizing yourself with permissionless methods for stacking sats.
This is an opinion editorial by Moon, a Bitcoin Maximalist and writer.
Just in case we needed a reminder, banks are showing us that they can and will gatekeep their customers’ money to prevent them from engaging with bitcoin. This should be a call to action for Bitcoiners or anyone else who wants to maintain control over their finances to move toward more proactive use of permissionless bitcoin tools and practices.
Ever since Jamie Dimon decried Bitcoin as a “hyped-up fraud” and “a pet rock,” on CNBC in late January 2023, I have found myself unable to purchase bitcoin using my Chase debit card on Cash App. And I’m not the only one — if you’ve been following Bitcoin Twitter recently, you may have seen Alana Joy tweet about her experience with the same.
In both of our cases, it is the bank preventing bitcoin purchases and blocking inbound fiat transfers to Cash App for customers that it has associated with Bitcoin, all under the guise of “fraud protection,” of course.
No, it doesn’t make a whole lot of sense — Chase still allows ACH bitcoin purchases and fiat on Cash App can be used for investing in stocks, saving or using Cash App’s own debit card, not just bitcoin — but yes, it is happening. Also, no one seems to know exactly when this became Chase’s policy. The fraud representative I spoke with wasn’t sure and couldn’t point to any documentation, but reasoned that the rule has been in place since early last year. Yet murkier still, loose chatter can be found on Reddit about this issue going back to at least April 2021.
However, given that I and so many others were definitely buying bitcoin via Chase debit throughout 2021 and 2022, I’d wager that this policy, up to now, has only been exercised haphazardly, selectively, arbitrarily, even. Dark patterns abound, but for now, it seems like I just happen to be one of the unlucky ones…
That said, there is nothing preventing this type of policy from being enforced broadly and in earnest by one or many banks. If and as banks feel threatened by Bitcoin, we will surely see more of these kinds of opaque practices.
It’s Time To Get Proactive
Instead, we should expect it and prepare for it. So, rather than railing against banks, I want to use this as a learning experience to reflect on the importance of permissionless, non-KYC Bitcoining, and the practical actions we can take to advance the cause.
1. Bank with backups and remember local options.
Banking is a service, not servitude. Treat it as such. Maintaining accounts at multiple banks may provide some limited fault tolerance against banks that take a hostile stance toward Bitcoin, assuming it does not become the industry norm. Further, smaller, local and regional banks may be more willing to work with Bitcoiner customers, as individual accounts can be far more meaningful to them than they are to larger national banks — though this certainly should not be taken for granted.
2. If you must use KYC’d Bitcoin services, do so thoughtfully.
For Cash App (and services like it), consider first loading in fiat and making buys out of the app’s native cash balance instead of purchasing directly through a linked bank account/debit card where information is shared with the bank that allows it to flag the transaction for being related to bitcoin. Taking this small step may help to avoid gatekeeping and can provide some minor privacy, from the bank at least.
3. Become comfortable with non-KYC bitcoin exchanges.
Just as many precoiners drag their feet before making their first bitcoin buys, so too do many Bitcoiners drag their feet in using permissionless channels to buy and sell bitcoin. Robosats, Bisq, Hodl Hodl — you can use the tools. For anyone just getting started, BTC Sessions has excellent video tutorial content on all three, which are linked.
If you don’t yet know how to use these services, it’s better to pick up this knowledge now through calm, self-directed learning rather than during the panic of an emergency or under pressure of more Bitcoin-hostile conditions later. And for those of us who already know, we can actively support these services. For instance, more of us taking action to maintain recurring orders on such platforms could significantly improve their volumes and liquidity, helping to bootstrap and accelerate their network effects.
4. Be flexible and creative with peer-to-peer payment methods.
Cash App, Zelle, PayPal, Venmo, Apple Cash, Revolut, etc. — the services that most users seem to be transacting with on no-KYC exchanges — they would all become eager and active agents of financial gatekeeping in any truly antagonistic, anti-privacy environment, even when used in a “peer-to-peer” fashion.
Always remember that there are other payment options — such as gift cards, the original digital-bearer items — that do not necessarily carry such concerns. Perhaps, an enterprising soul might even use Fold to earn bitcoin rewards on the backend for the gift cards used on the exchange…
5. Find your local Bitcoin community!
In the steadily-advancing shadow war on all things permissionless, private, and peer to peer, this is our best defense. Don’t just wait until you need other Bitcoiners to get to know other Bitcoiners — to paraphrase Texas Slim, “Shake your local Bitcoiner’s hand.” Get to know people and never underestimate the power of simply asking around. There could be real, live Bitcoiners near you looking to sell some corn and happy to see it go to another HODLer rather than to a bunch of lettuce-handed fiat speculators on some faceless, centralized, Ponzi casino exchange. What’s more, let folks know your skills, talents and expertise — you might be surprised to find an interested market that pays in BTC!
In closing, I believe we should think of permissionless bitcoining as an essential and necessary core competency, just like we do with self custody. And we should push it with similar urgency and intensity. But as we do this, we should also remember that it is a spectrum and a progression and that there are no perfect solutions, only tradeoffs. Realization of the importance of non-KYC practices will not be instant or obvious to near-normie newcoiners, coin-curious fence-sitters or even many minted Bitcoiners. My own experience is certainly a testament to this.
As we promote the active practice of non-KYC Bitcoining, we can anchor to empathy, patience and humility — always being mindful of the tremendous amount of unlearning most have to go through to get there. So, even if someone doesn’t get it the first time, or the nth time, that they hear it from us, if it helps them get to it faster at all, then it’s well worth it.
This is a guest post by Moon. Opinions expressed are entirely their own and do not necessarily reflect those of BTC Inc or Bitcoin Magazine.