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But don't banks want you to be in debt to them, paying 24.9% annual interest? Isn't this how banks make much of their money? Why would they care how you ensla

But don't banks want you to be in debt to them, paying 24.9% annual interest? Isn't this how banks make much of their money? Why would they care how you enslave yourself to them? Anyways, even if cash advances have been outlawed since I last did it freely and recklessly (been over 15 years, so maybe they have?), it doesn't take a genius to figure out how to get cash somehow or the other. As a proof of concept, the very first coin dealer I just found randomly using Google takes all major credit cards and sells silver by the ounce. Well, gee whiz, I can run up my cards buying silver ounces, walk down the street, sell them at a different coin shop for cash, then go buy whatever I want. Hmmm... What is the real reason banks don't want people making certain investments??

jakebellacera 8y ago
Because if you default, or go bankrupt, they lose out the interest payments and the debt owed back. Its all about risk management.
- irq11 8y ago
  Also, interest rates are much higher for cash advances, belying their higher risk profile. Honestly, the responses in this thread from bitcoin people...it’s like they’re just now realizing that banks have intelligent employees working for them.
  - jdmichal 8y ago
    Ding ding ding! Here's a random credit card from American Express. Cash advances have a drastically higher interest rate, PLUS a 3% (minimum $5) transaction fee. https://www.americanexpress.com/us/credit-cards/card-application/apply/prospect/terms/blue-cash-everyday-credit-card/25330-10-0#FeeTable https://www.americanexpress.com/us/credit-cards/card-applica... Same pattern for Chase Sapphire Preferred. Higher APR and this time a 5% (minimum $10) transaction fee. https://applynow.chase.com/FlexAppWeb/pricing.do?card=FS6K&page_type=appterms https://applynow.chase.com/FlexAppWeb/pricing.do?card=FS6K&p...
jaredklewis 8y ago
Of course banks want that interest, but if the customer defaults they incur a big loss, so they also need to manage their risk. With regards to cash advances, they come with much higher APR rates, to account for the increased risk and are often not available to card holders with low credit. Perhaps Wells Fargo would be more amenable to their customers buying crypto if they were able to charge a higher APR for such transactions, but I imagine this isn’t such a simple change given the many parties and agreements involved. As others have pointed out, the other aspect is fraud. Perhaps the anonymous nature of crypto currencies attracts more fraud payments than bullion? However, I am highly skepticle that you can buy silver with a credit card and then sell it for cash “down the street” without incurring huge transaction costs in the process. I’d be surprised if the process was even 80% efficient.
- rlucas 8y ago
  If you are in a dense coin/jewelry district of a medium-sized city, you can get darn close to the posted spot prices for mainstream coins. They will charge a bit extra but probably closer to a 5-10% rake than 20%. Source: I once negotiated a cash price for a jewelry piece in downtown Portland, Oregon and the jeweler accepted bullion I wanted to liquidate at quoted spot bid in lieu of cash for part of the price. If you are talking about getting "SAR levels" of USD folding green, though, you're going to need to make an appointment in advance. Plus, heavy. So the "walk 1600 oz of silver down the street" strategy has a number of practical impediments beyond the spread.
  - XalvinX 8y ago
    If you are buying 1600 oz. of silver, why not just buy 21 ounces of gold instead? lighter! But honestly I doubt too many people even have limits that high on their cards. Anyways, as an American who's grandfather landed on Normandy in WWII and who actually has roots back to the Mayflower (I do!) the very idea of an "SAR level" makes me fricking sick. Disgusted. People should be free to do what they want with their money and not have to tell anyone anything, period. Not only with their money, either..with their free time, the communications, their travels, their bodies and souls...LIBERTY should not just be an empty slogan on cheap metal coins and in songs and engraved on old stone statues. It is really too bad what the USA has become, and I hope that the future will see a brighter day for "we the people"..
twblalock 8y ago
They want people to get in debt and then make payments, not get in debt and then default. > Hmmm... What is the real reason banks don't want people making certain investments?? If you're suggesting some kind of conspiracy against cryptocurrencies by banks, you should provide some evidence to counter the entirely reasonable justification about the high default rate the article has given.
- XalvinX 8y ago
  I never used the word "conspiracy" but don't you think the Federal Reserve and other central bankers are at least talking about it, making some contigency plans, ..next step is what is sometimes called in shadier parts of society as "calling in markers" ...you cannot deny that Wells was one of the banks bailed out in '08 so...umm...

jakebellacera 8y ago

Because if you default, or go bankrupt, they lose out the interest payments and the debt owed back. Its all about risk management.

irq11 8y ago
Also, interest rates are much higher for cash advances, belying their higher risk profile. Honestly, the responses in this thread from bitcoin people...it’s like they’re just now realizing that banks have intelligent employees working for them.
- jdmichal 8y ago
  Ding ding ding! Here's a random credit card from American Express. Cash advances have a drastically higher interest rate, PLUS a 3% (minimum $5) transaction fee. https://www.americanexpress.com/us/credit-cards/card-application/apply/prospect/terms/blue-cash-everyday-credit-card/25330-10-0#FeeTable https://www.americanexpress.com/us/credit-cards/card-applica... Same pattern for Chase Sapphire Preferred. Higher APR and this time a 5% (minimum $10) transaction fee. https://applynow.chase.com/FlexAppWeb/pricing.do?card=FS6K&page_type=appterms https://applynow.chase.com/FlexAppWeb/pricing.do?card=FS6K&p...

jaredklewis 8y ago

Of course banks want that interest, but if the customer defaults they incur a big loss, so they also need to manage their risk. With regards to cash advances, they come with much higher APR rates, to account for the increased risk and are often not available to card holders with low credit. Perhaps Wells Fargo would be more amenable to their customers buying crypto if they were able to charge a higher APR for such transactions, but I imagine this isn’t such a simple change given the many parties and agreements involved. As others have pointed out, the other aspect is fraud. Perhaps the anonymous nature of crypto currencies attracts more fraud payments than bullion? However, I am highly skepticle that you can buy silver with a credit card and then sell it for cash “down the street” without incurring huge transaction costs in the process. I’d be surprised if the process was even 80% efficient.

rlucas 8y ago
If you are in a dense coin/jewelry district of a medium-sized city, you can get darn close to the posted spot prices for mainstream coins. They will charge a bit extra but probably closer to a 5-10% rake than 20%. Source: I once negotiated a cash price for a jewelry piece in downtown Portland, Oregon and the jeweler accepted bullion I wanted to liquidate at quoted spot bid in lieu of cash for part of the price. If you are talking about getting "SAR levels" of USD folding green, though, you're going to need to make an appointment in advance. Plus, heavy. So the "walk 1600 oz of silver down the street" strategy has a number of practical impediments beyond the spread.
- XalvinX 8y ago
  If you are buying 1600 oz. of silver, why not just buy 21 ounces of gold instead? lighter! But honestly I doubt too many people even have limits that high on their cards. Anyways, as an American who's grandfather landed on Normandy in WWII and who actually has roots back to the Mayflower (I do!) the very idea of an "SAR level" makes me fricking sick. Disgusted. People should be free to do what they want with their money and not have to tell anyone anything, period. Not only with their money, either..with their free time, the communications, their travels, their bodies and souls...LIBERTY should not just be an empty slogan on cheap metal coins and in songs and engraved on old stone statues. It is really too bad what the USA has become, and I hope that the future will see a brighter day for "we the people"..

twblalock 8y ago

They want people to get in debt and then make payments, not get in debt and then default. > Hmmm... What is the real reason banks don't want people making certain investments?? If you're suggesting some kind of conspiracy against cryptocurrencies by banks, you should provide some evidence to counter the entirely reasonable justification about the high default rate the article has given.

XalvinX 8y ago
I never used the word "conspiracy" but don't you think the Federal Reserve and other central bankers are at least talking about it, making some contigency plans, ..next step is what is sometimes called in shadier parts of society as "calling in markers" ...you cannot deny that Wells was one of the banks bailed out in '08 so...umm...