What does it feel like to suddenly lose your bank account before Christmas? An immigrant shares his personal experience of an unexpected account closure by Chase Bank, revealing the systemic dilemmas of traditional financial systems and how cryptocurrencies can serve as practical solutions for cross-border individuals. This article is based on Boaz Sobrado’s account, compiled and edited by ForesightNews.
(Background: Why does the US embrace crypto? The answer may lie in the $37 trillion debt)
(Additional context: From AI to Labubu, from gold to cryptocurrencies: Why are global speculative bubbles everywhere?)

Table of Contents

• The systemic dilemma behind account closures
• A typical personal experience
• Cryptocurrencies: an alternative to the banking system?

What does it feel like to suddenly lose your bank account before Christmas? On December 19, about four weeks after I arrived in the US and opened a Chase Bank account, I received a bank email in my inbox. The notice was cold and impersonal, just a standard template:

“This is to inform you that your account has been closed.”

The bank provided no explanation, only a list of instructions: destroy the bank card, cancel automatic payments, update e-wallet information, and wait for written notice. The letter claimed that further details would be sent later, but to this day, I have yet to receive any explanation.

My account held several thousand dollars, with various bills set for automatic deduction. I had just moved abroad, and Christmas was just around the corner.

I am not the only one to experience this frustration. In November of the same year, Jack Mallers, CEO of Bitcoin payment company Strike, also faced a similar ordeal. Chase suddenly closed his personal and business accounts, citing “suspicious transaction activity” as the reason. Even more shocking, Mallers’ father had been a private banking client of the bank for years.

Coincidentally, Russian lawyer Anya Chekhovich, working at Alexei Navalny’s anti-corruption foundation, also had her bank account frozen after the Russian government designated the foundation as an “extremist organization.” Although Chase ultimately reversed the account closure after public outrage, the damage was already done. The wording of these account closure notices was eerily similar, chillingly so.

Chase is not an isolated case. In December, preliminary investigations by the US Office of the Comptroller of the Currency revealed that between 2020 and 2023, nine major banks (JPMorgan Chase, Bank of America, Citibank, Wells Fargo, U.S. Bancorp, First Capital Bank, PNC Bank, TD Bank, and Montreal Bank ) engaged in systemic account closure behaviors. The targeted entities included crypto companies, arms dealers, oil and gas firms, and various political groups.

The Trump administration has made this issue a priority. In August, Trump publicly stated that Chase and Bank of America had refused over $1 billion in deposits from him, which directly prompted him to issue an executive order instructing regulators to investigate such “politically motivated or potentially illegal account closures.”

Most media reports overlook a key point: the essence of this issue is far more complex than a simple political or ideological game.

The systemic dilemma behind account closures

Patrick McKenzie, a senior figure in the payments industry, provided an answer in his influential paper “Viewing the Problem from a Banking Perspective,” sharply pointing out the shortcomings of the banking system: banks are very good at tracking ledgers and confirming the ownership and flow of funds, but beyond that, they are fundamentally incapable of effective monitoring of other information.

The root of the problem lies in the underlying architecture of banking systems. The core processors of banks must interface with numerous subsystems, creating multiple points of data transfer. For example, the decision to close an account might be generated in system A, archived in system B, and notifications sent through system C. When you contact customer service, the staff you speak with has no access to any of these systems.

To control costs, banks adopt tiered customer service systems. First-line support can only recite scripts; second-line support has slightly higher authority; and the truly knowledgeable third-line specialists do not handle customer inquiries at all. This tiered model is an inevitable consequence of the low-profit nature of retail banking. It allows a high school student to open a checking account easily, but also means that accounts can inexplicably disappear due to system errors.

Meanwhile, banks face strict regulatory requirements. In many cases, they must submit “Suspicious Activity Reports” (SARs), including for international wire transfers, or when a customer holds multiple nationalities. Ironically, sometimes merely knowing about the existence of a SAR can trigger the bank’s reporting mechanisms.

According to US federal regulation 12 CFR § 21.11 (k), once a bank has filed such a report regarding a customer, it is legally prohibited from informing the customer about it. The law mandates confidentiality, so banks cannot provide any explanation.

A typical personal experience

When Chase sent that cold, uninformative account closure notice, perhaps they were acting within the law, or perhaps it was an algorithmic risk assessment decision. This assessment may seem reasonable in algorithmic logic, but in plain language, it appears absurd. Having multiple nationalities, an overseas background, and a modest account balance—such a customer is simply not worth the trouble for the bank. I happen to fit this high-risk profile perfectly.

This tiered customer service system also has special channels for VIPs like prominent social media activists or regulatory personnel, who can directly access technical support teams with real authority. Ordinary customers, however, are left to navigate endless menu options. Naturally, I was too lazy to keep calling for inquiries.

For me, having my account frozen and being unable to access funds for weeks was just a minor inconvenience. But for those already struggling financially, it’s an unshakable nightmare. Banks are meant to serve the masses, a societal necessity. However, the high costs of covering everyone have ultimately created a system that is extremely unfriendly to “outliers.” When financial inclusion becomes the norm, the number of such “outlier” customers is actually much larger than expected.

Cryptocurrencies: an alternative to the banking system?

When I received that account closure email on December 19, my thoughts weren’t about Federal Reserve policies or decentralization debates, but about the tangible advantages of cryptocurrencies. I hold several thousand USDC stablecoins in a self-custody wallet, which I can access at any time: no need to press buttons repeatedly in voice menus, no waiting for checks to arrive, and no worries about when I can get my money back.

For immigrants, foreigners, and globally mobile workers—people whose lives cross borders—traditional banks see their identities as a risk. Multiple nationalities and living backgrounds mean multiple compliance checks, triggering risk alerts, and algorithms often give a “too troublesome, not accepted” judgment.

Stablecoins were designed precisely to serve these kinds of people, providing a dollar-denominated value transfer medium that can cross borders freely. In the eyes of traditional banks, these features are “risk signals,” making stablecoins an ideal solution for such needs.

The high-level attention from the Trump administration on “illegal account closures” may inadvertently accelerate the adoption of cryptocurrencies. When influential crypto executives like Mallers face account closure issues, it draws more attention to the problem. But the core driver for large-scale crypto adoption isn’t political factors; it’s the terrible experience ordinary people have within the traditional banking system.

I am still waiting for Chase’s explanation letter, hoping it will clarify what happened. But most likely, it will be just like that vague email—full of references to seemingly reasonable policies and procedures that, when applied to individuals, seem arbitrary and unjust.

Banks are not malicious; they are just institutions that can’t keep up with the times. They try to use outdated systems to manage a complex financial ecosystem. These systems often generate false risk alerts, and sometimes, that alert hits someone right before Christmas.