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Are Canadians Withdrawing Their Money from Banks?

  • Fears of account closure have pushed Canadian bank customers to withdraw account holdings and secure their funds in cash and other means.
  • Cryptocurrencies remain a form of escape for Canadians who are not only funding protests with crypto but saving in them as well.

In reaction to recent moves from the Canadian government, residents have opted to protect their finances by withdrawing existing bank balances. It began a week ago when the prime minister of Canada Justin Trudeau invoked the Emergency Act in an attempt to hack down on the Freedom Convoy 2022 protests. 

Freedom Convoy 2022 is an ongoing demonstration against the government’s covid-19 vaccine demands, alongside others pending issues. The protest features truckers obstructing traffic and causing intentional noise disturbances by repeatedly honking horns. 

Justin’s recent enactment gives the Canadian government power to freeze accounts without judicial permission.  The new law apparently targets the cash flow for the protest campaign. There are also reports that the government intends to take the drastic action of freezing truckers’ bank accounts, or any account tied to the protest. 

Reports say that the Canadian police have already frozen 34 accounts associated with the demonstrations, bypassing the usually required judicial order. Just to be safe, people have taken to pulling large quantities of cash from Canadian banks.

As a result, English economic journalist James Melville drew attention to the curious trend of withdrawals on Twitter. Melville’s thread featured images of major banks in Canada alongside their corresponding spikes in outages in the past 24 hours.

Responses to Melville’s post suggest that people are confident massive withdrawals are responsible for the outages, with several users labeling it “a bank run”. A bank run happens when a group of depositors all withdraws their stash from a bank due to fears of insolvency or similar.

Jabba wrote:

Bank run starting 😜. If you threaten to take people’s money a lot of them get worried and take their money out. Banks don’t like seeing a lot of money go out, so they ‘go down’ to stop the run.”

Another user expressed similar thoughts, in light of the recent account closures.

Aside from account closures, the Canadian government is also interested in other forms of punishment. The government warns that arrested protest actors will also have their names added to a misconduct list. Being on this file essentially makes securing a job difficult for those appended to it. 

Recent actions from the Canadian government have led to questions from many regarding the nature of the country’s democracy. 

Canadians Embrace Crypto as an Alternative

While some secure their money in hard cash, other Canadian bank account owners opt for a different alternative of converting their financial holdings to crypto. Developments on social media suggest that many have taken to converting their assets from Canada’s local fiat currency to Bitcoin, as well as other alternative cryptos. 

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Canadian residents have sought for decentralized digital wallets to keep their funds out of the government’s reach. Thanks to the independent, decentralized technology Bitcoin is built on, funds deposited in crypto wallets are impervious to government interference. Events of this nature are one of the worries that motivated crypto invention in the first place, according to Ethereum co-founder, Vitalik Buterin.

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