North Macedonia and LocalBitcoins Crack Down on Cash

Starting June 1st, North Macedonia will limit cash payments to 30,000 Macedonian Denar (around 500 Euros or 560 USD) and LocalBitcoins has eliminated the option to make cash trades.

The North Macedonian law specifies that “[o]n money laundering and terrorism financing” as a reason for limiting citizens’ cash purchases to 30,000 Macedonian Denar. The North Macedonia’s Finance Minister Dragan Tevdovski specifically told reporters that “[t]he government has decided to lower cash payment limits aiming to reduce shadow economy”, which is estimated to be over 30 percent of the country’s economy according to the Confederation of Businesses in North Macedonia. This is not the first time the country has attempted to restrict cash since they previous lowered the max cash payment from the equivalent of 2,000 euros to 1,00 euros in January 2019.

Then LocalBitcoins, one of the oldest P2P cryptocurrency exchanges, eliminated the cash trade option so users can no longer meet in person to sell/buy Bitcoin for cash. LocalBitcoins made the removal without any official announcement as to the reason, but does come not too long after implementing more KYC for larger trades and stopped services for Iranians.

Continual efforts to restrict cash usage

Cash restrictions and bans are nothing new as they have been tried multiple times previously. The most famous example is when India attempted to ban high value cash notes in an attempt to crackdown on criminal groups. However, the policy is largely viewed as a failure and has hurt the poor more than the intended targets. The theory largely arises from economist Kenneth Rogoff who believes the elimination of cash will eliminate tax evaders and allow for more monetary policy prescriptions. Other countries such as Australia has banned cash payments over 10,000 AUD and the UK has flirted with the idea of placing some limitations on cash.

Some exchanges have been coming under increased pressure from regulatory authorities to introduce various KYC/AML compliance. Shapeshift got a lot of attention for introducing a required “membership”, which required user to submit personal information to become a member and was largely viewed as a marketing cover for required KYC/AML compliance. This increasing trend has also given rise to more decentralized exchanges as consumer demand for privacy increases.

Dash facilitates easier direct payments

Consumers opt for cash for different reasons that vary from a lack of banking access to a desire for privacy, which is what cryptocurrency was meant to replace. However, cryptocurrency’s usefulness as a cash replacement is directly linked to the ease of use in spending cryptocurrency for goods and services that would have been bought with cash. Dash aims to be digital cash by focusing on ease of use, inexpensiveness, quickness, security, and privacy.

Dash has been able to achieve integrations at around 5,000 merchants around the world and catalog them for easy consumer reference at DiscoverDash. Recently, Dash also initiated automatic InstantSend, which locks-in transactions in less than two seconds and makes Dash as confident as cash for no extra fee. This is integral for certain merchant adoption, such as restaurants, cafes, or street vendors that cannot afford to wait 10 minutes for a confirmation. Further, Dash more recently implemented ChainLocks, which makes the blockchain even more secure against 51% attacks, which is also integral for the same merchants, as well as others using the blockchain. While different governments and agencies move to restrict cash usage, Dash is providing a realistic alternative for consumers in everyday life.

 



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