Lebanese Central Bank Should NFT Gold Bullions instead of unfreezing Compulsory dollar reserves

Once again Lebanese Central Bank governor was quick to bail out the Lebanese state by yet again utilizing Lebanese citizens’ dollars in the compulsory reserves in Banque Du Liban. How? Well simply The Central Bank Governor has come out with a run around solution where the Central Bank has enabled itself to unfreeze and utilize the amount of 1.2 billion USD from the compulsory dollar reserves (which under law are not allowed to be touched). The Central Bank intends to use these dollar reserves to pay for subsidies and expenses of the Lebanese state, while giving the illusion to Lebanese that the Central Bank is paying back the Lebanese account holders from these reserves.

As per the recent announcement, Lebanese Banks in collaboration with Central Bank of Lebanon will pay back Lebanese account holders the dollars owed to them. But a look closer into the proposal and in actuality only the Lebanese banks will be paying the dollars, while the central bank will be paying in Lebanese Liras at the rate of the newly created Sayrafa exchange which pegs the dollar at 12,000 L.L

As per the announcement, from the total of 2.4 billion USD to be released, Lebanese banks would utilize 1.2 billion USD of funds in correspondent banks, to pay 400 USD per month to their customers. The other 1.2 Billion USD  was to be utilized from Central Bank of Lebanon’s compulsory reserves, will be paid by Central Bank of Lebanon, but not in dollars which is what they are reserved as, but rather in  Lebanese Liras. This gives the Central Bank the opportunity to unfreeze the amount in dollars, allowing the Central Bank to utilize this for state expenditures, while paying the Lebanese account Holders in Lebanese currency, increasing not only the amount of Lira in circulation, ( increasing inflation), but allowing the bank to use the actual dollars for government expenditures.

Several issues come to play here, first why does the Lebanese Central Bank always come up with the same solution to save the corrupt indebted Lebanese state, a solution where they continue to utilize Lebanese citizen’s money in the banks to pay for the failing state. If the Central Bank can come up with a run around solution such as this, to go around laws in place not allowing them to touch this money, why can’t they come up with something that actually serves the Lebanese bank account holders whose money has been taken by an indebted state, rather than once again just benefit the state and not the citizens.

For example, One plausible and logical as well as innovative solution would be to NFT (Non Fungible Token) the gold reserves of Lebanon, not all, but enough to pay for what is needed while giving actual value to bank account holders whose money is stuck in the compulsory reserve. Currently there is no law in Lebanon that states you cannot sell a digital representation or tokenized asset of Lebanon’s Gold reserves.