This is a cross-post to our brother/sister platform, so you can either read this post on janromme.com or on seriousaboutech.com.
Last week the well-known software engineer and investor Marc Andreessen (of Mosaic/Netscape fame) went on a long interview at with Joe Rogan in which he explained, to I imagine the shock of millions of listeners, the existence of a pressure mechanism barely controlled by rule-of law namely: debanking.
This is like deplatforming. When you are kicked off Twitter or Instagram, you are deplatformed. When the bank cancels your bank account and tells you in a letter, phone call or email that you have x days to take your money and leave, that's called debanking.
David Marcus worked at Meta (Facebook and Instagram are well-known companies of Meta) to set up their cross-border payments platform Diem/Libra, and were targetted by what I would call Law-fare (it's a wordplay on warfare). Many others chimed in to relate similar harrowing stories of how they had to keep cash under a mattress because not only did they lose their bank account, but also would no other bank start a banking relation with them.
You could be excused for thinking these things only happen to rich and powerful people with similar adversaries somewhere far away in that parody of a country, the United States.
Let me tell you about my past week now.
Since we adopted the "Black Friday" craze here, I wrote a comparison of mobile phone subscription plans and set my mind to becoming a customer at an MVNO called Ben. After filling out some form for number porting and such like, I received an email that I am rejected as a customer. The reason is that one or multiple of these 3 companies has deemed my "not creditworthy enough": Preventel, Experian and Focum.
I always pay my bills and have no outstanding debts anywhere, so this is an obvious mistake.
But I didn't have the time, energy or even the impulse to challenge these 3 companies (that I never heard of before that day) so I just went to the next telecom provider on that list that was 33 cents more expensive.
But that was not all…
Some elderly friends of mine, who live down the street, complained about their slow iPads. So I told them I would help them order new iPads. They both wanted the iPads Air M2, which, I think, is a good choice because the iPad A17 is now old tech and the iPad Pro M4 is expensive overkill for almost anybody.
I had my laptop with me, so I proposed we order both devices and fitting cases from my laptop.
One day later, one of these ladies is in the supermarket, and she discovers to her horror that her debit card is blocked. I don't know if/how she paid at that instance, but she right away went to her bank to complain. The explanation for her being blocked was that with her bank account, a payment was detected by CrowdStrike to have originated from a "laptop that also does crypto transactions".
The fact that she had to authenticate and confirm these transactions and the fact that we just ordered something on Amazon, and the fact that this, according to the bank, "suspicious" transaction was not blocked, but the next one was, is mind-boggling to me.
How easy would it be for an well-meaning but misguided algorithm, AI or a semi government organization to debank or block whole swats of people that it, or they, deem 'unwanted'? Our societal reliance on these choke points makes us fragile. This is one of the reasons why the Human Rights Foundation and others are so sceptical of Central Bank Digital Currencies, the latest efforts to do away with cash all together. I know my individual actions, trying to pay with cash wherever i can for example, will in no way turn this tide. So why bother trying?
On that happy note: until next time 👍
