Bitcoin is the Best Offshore Bank Account

It took me a month to open a bank account in the UK thanks to terror-related financial regulation.

In the end I opened a very basic account, got the branch to print the bank statement, walked out of the bank and then walked back into the bank to get a proper account with my freshly printed proof of address before the ink dried.

Then the banker implied to lie extensively about information like my income and assets for the opening of my new account because international information wasn’t valid.

In Australia opening an account takes less than five minutes for anyone with a passport.

No matter where you are, transferring money costs a fortune thanks to all the checks the banks must go through to examine whether you’re secretly funding Al-Qaeda.

Accountants and lawyers are making a fortune out of ordinary customers who need to satisfy the government they’re not paying for an AK-47.

It’s all absurd.

As the financial repression gets worse, more and more people want out of the stupid system.

They want to secure their wealth outside the jurisdiction of politicians gone wild.

It’s not just terrorism related, of course. In the guise of preventing terror, governments will get access to vast amounts of information about you. Once they have the information, you can become a target of any new policies. For example, banks dealing with Americans must notify the American tax authorities if they suspect a customer of evading tax. And they must know their customer’s affairs in such detail that suspicion is a very low bar.

Many international banks rejected their American customers because of these laws. But in the end such laws are likely to go global. Once banks make it their business to know your affairs, and they’re required to report any discrepancies to the government, any new laws will be enforced with vigour.

New taxes, capital controls and costs are coming your way.

How to escape the law (of the future)

Do you fancy your own offshore bank account? A place to hide your money away from the Hammonds, Mays and Corbyns of the world. A place to protect your retirement.

It’s not about flouting the law, it’s about making sure the law cannot flout you. That’s why all the politicians have offshore bank accounts. They know that laws are fickle and can be turned against them.

The problem is, there are money-grubbing politicians everywhere. Even in the safest tax havens like Switzerland. In recent years the Swiss have been cooperating with the Americans, as described above.

The good news is, there’s a far better option.

Use bitcoin as an offshore bank account

Bitcoin is the ultimate offshore bank account. And for a very long list of reasons. But first, I’m going to point out its big weakness.

Nobody ever does this when trying to convince you to sign up to their offshore account in St Kitts or Geneva. They wait till you’ve applied and then send you the disclosure statement with all the pitfalls.

Well bitcoin has one big risk – it’s price. Offshore bank accounts usually offer the ability to hold a variety of currencies and other assets to diversify away this risk. Bitcoin is its own currency of sorts, with its own exchange rate. That exchange rate could rise or fall, affecting the value of your holdings.

Given bitcoin’s history, big price rises and crashes are to be expected. Although you also can’t ignore the broader upward trend.

Chart showing the evolution of bitcoin's price.

There are many reasons to believe the bitcoin price will go up over the long term. In short, it’s only starting to get used in the real world. Every day, many more people and companies are using it. Recently Japan made the currency legal and the Japanese financial markets are integrating it. Each time there’s some sort of geopolitical crisis, the price surges as people use bitcoin to make transactions their government doesn’t approve of.

And this is where bitcoin becomes relevant to you. Offshore bank accounts are permitted but frowned upon. They are a way to put your wealth outside the government’s reach. And that’s important in the times we live in. Who knows what sort of policies are planned for your nest egg?

But offshore bank accounts are deeply flawed in a way that bitcoin isn’t.

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Why bitcoin is the ultimate offshore bank account

The biggest advantage bitcoin has over offshore banks is that it’s truly offshore. Not just off Britain’s shores, but off every country’s shores. That means bitcoin isn’t subject to any other country’s politicians and banks.

People who used the offshore banking centres of Cyprus and Switzerland to keep their capital learned this lesson the hard way. Cyprus was struck by Europe’s sovereign debt crisis and imposed capital controls to stop people drawing out their money. British pensioners living in Cyprus were skewered.

In Switzerland, steady pressure from the EU and US slowly whittled away the famous client privacy that Swiss banks stood by for generations.

Well bitcoin doesn’t have a country or jurisdiction. There is nobody that governments can pressure to hand over your savings or personal information. Politicians don’t rule bitcoin. Bitcoin can’t have a sovereign debt crisis. Capital controls won’t work. It’s the ultimate offshore bank account.

And that’s just one reason why bitcoin is superior. There are many others…

Bitcoin booms during bad times. A financial crisis in Europe? Another imploding socialist economy in South America? More Chinese capital controls? Bitcoin does well just when your other assets are struggling. That’s just what you want from your offshore account – hedging and diversification.

So which brokers and bankers do you pay to manage your bitcoin account? What are the monthly fees and charges? Who do you have to trust to keep your bitcoins safe?

Nobody, none and nobody.

Bitcoin doesn’t need bankers, brokers, lawyers, accountants or any other expensive people charging you for the “privilege” of using their services. It’s more like cash than some sort of account which promises you money should the bank decide to honour its obligations and be in a financial position to do so. But the cash is digital.

Unfortunately most people have to use a bitcoin provider to do their dealings with bitcoin. But you can still move your bitcoin to the safety of a wallet away from any intermediary.

You can already use bitcoin to buy things, just as you do other currencies. But an offshore bank account is designed to keep your wealth safe, not serve as some sort of day-to-day transaction account. For now at least, bitcoin is best suited to this purpose too.

When you decide it’s time to move some of your bitcoin back to a more practical currency, you can. Anywhere in the world and to any currency of the world. Usually at very low costs.

Of course technology should allow you to stick to bitcoin entirely soon. Bitcoin payment cards are already in the pipeline. These allow you to pay for your daily coffee in bitcoin by transferring to pounds at the moment of the transaction.

But for now, bitcoin offers the key advantages of an offshore bank account without the key pitfalls.

Then again, my friend Sam Volkering reckons there’s an even better option than bitcoin. He calls them giga-coins and if he’s right, you stand to gain an enormous profit of thousands of per cent. You’ll be needing an offshore bank account then!

The big rule of using bitcoin as an offshore bank account

There’s one enormous mistake you could make in your attempt to use bitcoin as an offshore bank account. A bitcoin wallet has a public key – like an email address to which your bitcoin are sent, and are sent from.

Do not, ever, ever, link your public key with you in any way. At least not the public key of the bitcoin wallet you want to use as your offshore bank account.

You see, bitcoin works by keeping an open ledger. It’s a record of every bitcoin transaction. And using that ledger, authorities can trace back every bitcoin transaction to a public key. If they can link a public key to a person, by an email address or something like that, then they instantly have a record of that person’s transactions.

You can have many bitcoin wallets. Some you might want to use for transactions with companies and bitcoin ATMs, of which there are hundreds around the world. But your bitcoin wallet which serves you as an offshore bank account should not be linkable to you as a person.

So that’s how I think you should keep some of your money safe from the government’s coming crackdowns. But don’t forget to check out how to make money from cryptocurrencies too.

Are you ready to change Caiman Islands for Bitcoin now? Leave us your comments below.

Nick Hubble,
Capital & Conflict

P.S. Bitcoin isn’t just a way to store your wealth offshore…

Bitcoin and other crypto-currencies have massive potential as long-term investments too.

Early entrants in the right cryptos have made astronomical gains in as little as a few months!

To get the exact info you need on how to purchase and store bitcoin, as well as what cryptos to buy now, click here to claim your copy of the Crypto Revolution book.

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Category: Investing in Bitcoin

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