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Good question. Definitely yes. Why would I pay middlemen (banks) when there is no need to? Also why would I trust them, when there is no need to?
by sh4rk 8y ago
Good question. Definitely yes. Why would I pay middlemen (banks) when there is no need to? Also why would I trust them, when there is no need to?
- umanwizard 8y agoCryptocurrencies are not a replacement for banks; they are a replacement for gold. If cryptocurrencies ever become mainstream, banking services will be built on top of them, just as they were originally built on top of gold. The only thing I can think of that cryptos let you do cheaper than banks is rapid, relatively frictionless funds transfer, so I’ll admit their utility there. But other than that, what banking services do cryptos give you?
- Semaphor 8y agoLoans, money transfer, storing your money are all things that can be replaced. Seems like a decent chunk.
- jayd16 8y agoLoans no, not at all. Money transfer for coin is extremely inefficient. Volatility makes crypto a terrible place to keep money. Besides, you're paying for the legal and institutional protection anyway. If crypto made money transfer more efficient, they'd use it and still have the value add of a large institution backing transactions.
- omarchowdhury 8y ago> Loans no, not at all. https://makerdao.com/dai/ https://makerdao.com/dai/ $80M DAI issued so far...
- Isomatik 8y agoThat's only useful as a hedge for ETH. A mortgage where you have to put down 373% of the value of the house in liquid currency as collateral is not competitive in the slightest. https://mkr.tools/ https://mkr.tools/
- omarchowdhury 8y agoSure, but I'm responding to the disingenuity or possibly the ignorance of saying "no loans, at all."
- Semaphor 8y agoI thought we were talking about the hypothetical situation where crypto becomes amazing and not at the current state? Of course, crypto can't replace banks as it is now…
- solotronics 8y agoabsolute control over your money
- umanwizard 8y agoAgain, nothing stops you from keeping gold under your bed. The reason people don’t do this is because most people don’t actually need, want, or care about having absolute control over their money. And the probability of your home being robbed is much higher than that of your bank (and the FDIC) becoming insolvent.
- sparkie 8y agoA government can steal your gold an outlaw it, as the US government did in 1933. They can also try to outlaw bitcoin, but they have a bit more trouble stealing it.
- omarchowdhury 8y ago> Again, nothing stops you from keeping gold under your bed. Can I transmit my gold in any quantity that I want to anyone in the world with an Internet connection for a few dollars in fees?
- brazzy 8y ago> Also why would I trust them, when there is no need to? Because your alternative is to trust the crypto infrastructure, which is far less trustworthy.
- scient 8y agoBut muh decentralization! /s In reality most of the exchanges and sites dealing with crypto were (and probably still are) built by absolute amateurs with no checks and balances on their apps from a security perspective. Its scary as hell that people trust those sites with their actual money.
- semi-extrinsic 8y agoThe recent QuadrigaCX fiasco shows this very clearly. The entire exchange (one of the biggest in Canada) was somehow just running on the encrypted laptop of this one guy, and after he suddenly died in December, there is 250 million Canadian Dollars owed to 100k+ customers that nobody can recover, because the guy with the password is dead.
- 52-6F-62 8y agoMinor correction: the exchange wasn’t running on a laptop. It was run on systems you’d expect it to run on. What was stored on the encrypted laptop was all of the cold storage wallets containing the majority of the digital assets. No less idiotic, but an important factual distinction.
- semi-extrinsic 8y agoAha, this makes sense. (Wikipedia states that the exchange was running on his laptop, which I did indeed find curious/impressive.)
- arisAlexis 8y agowhat do you mean by crypto infrastructure? you mean the code or the miners? actually banks have failed in the past, this infrastructure not yet
- beefield 8y ago> Why would I pay middlemen (banks) when there is no need to? Also why would I trust them, when there is no need to? Payments are only relative small function of financial sector. Much more important is to act in credit markets, i.e take deposits and issue loans. How did you think that crypto removes need for fees (interest rate) and trust in those applications?
- koonsolo 8y agoI see this as a disadvantage of using banks. They act as if you can freely access your money in your account, but actually you can't. That money is loaned out for the most part, and it's a trick that keeps the current system going. But once you have a bank run, reality will kick in on how banks really work. At least the cryptocurrency that you own is really yours today. The numbers on your bank account are yours some day.
- rmah 8y agoMost people I've spoken with about crypto prefer the way banks work. The idea that losing your keys means losing your money, with no recourse, terrifies them.
- omarchowdhury 8y ago> The idea that losing your keys means losing your money, with no recourse, terrifies them. All the more incentive to not lose them!
- j0ba 8y ago> no recourse Recourses: - Backed up dat file - Backed up wallet password - Recovery phrase There, now you have 3 separate ways to not lose your btc!
- RugnirViking 8y agoyou also have 3 ways for someone to steal it !