Chase Has Begun a Covert War on Bitcoin

By Michael Krieger: The past several days have seen considerable weakness in the price of bitcoin. The selling was sparked by the revelation that the Chinese government had essentially instructed its financial system to avoid it. Then yesterday it was revealed that China had banned third-party payment companies from doing business with bitcoin exchanges. As far as price is concerned, I have stated repeatedly via Twitter that I think the China news caps the upside in the near-term (baring other material news of course) and that we are in a new range of $650-$1050 per BTC. At roughly $700 where we are now, I think at least 75% of the “China premium” is now out of the price. This sets up a solid risk/reward profile. However, there is one thing in the U.S. that people should be aware of and represents some headline risk if true.
Recently, a friend of mine noted that Chase has threatened to shutdown his business account due to his use of Coinbase (remember Coinbase recently received the largest VC investment in Bitcoin to-date). Apparently, the problem hasn’t been when money moves out of U.S. banking deposits and into the Bitcoin ecosystem, but rather when the currency is converted back to dollars and then deposited back into the Chase accounts. With this already being in my mind, I read the following Reddit post this morning:
Hi everyone,
A few weeks ago, I posted that Chase decided to terminate my account, and they never notified me as to why they would do this. However, I believed it to be Bitcoin-related.

Prior to the termination, my business (BuyAHash.com) had signed a deal with Chase PaymenTech for credit card processing, as PayPal was showing some signs of being anti-Bitcoin. Through that process, I asked my contact at Chase if PaymenTech would follow suit and become problematic with us. He advised us that they wouldn’t, and that the two companies were separate.
Turns out, that is a lie. We just began processing credit cards on our site a few days ago. Over the weekend, we were “Flagged” because of some large purchases (ASICMiner cubes for fiat). We went through their fraud resolution process, and today, I got a notice from them stating that our account would be terminated on 12/30.
Furious, I called up both the analyst at Chase that was doing the investigation, as well as the contact that brokered the agreement (because part of this “Termination process” involves Chase holding $20,000 of sales back in case of chargebacks, as part of their reserve process).
A few minutes ago, I had the analyst call me back, and (for the first time ever), gave me a very clear statement, which is as follows:
*Chase has deemed any activity involving Bitcoin as high-risk, and therefore is banned from our company. This includes both selling Bitcoins, and Bitcoin related hardware.
This was the direct statement from the analyst. Anything that you may have that is involved with Chase that has ever involved Bitcoins is not safe. PaymenTech processes 60% of all US credit card transactions (or so they say), so if you sell anything related to BTC/BTC products, you will need to move your accounts immediately or face termination. The analyst stated that this decision was very, very recent, but is official. He said he’s never dealt with this kind of termination. People may be able to fly under the radar if they haven’t got flagged for anything, but I am certain that as soon as they review your account, they will terminate it as soon as its convenient for them.
TL;DR: Chase looks like its officially adopted an anti-bitcoin stance for merchant/businesses, and deemed them in a high risk category that they will refuse to do business with in the future
Update 1: Please note that this pertains to business accounts/merchant processors only. There are many people that have commented that their personal accounts are fine, despite using CoinBase. If you’re a personal customer, you may not be in jeopardy, but as a business, you really should look elsewhere, as I am not the first business to have drawn the ire of Chase.
The reason for this post is simple. If you are a Bitcoin related business and use Chase for banking, you should immediately inquire whether any of the above is true, and consider moving to a more Bitcoin friendly bank.
In Liberty,
Mike

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X art by WB7