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RE: BABB - Everyone is a Bank - the Blockchain based Bank
This will be the slowest most useless bank imo, banks can exist as they are. The problem is when they screw retail customers. That's what btc can take care of quite well. A blockchain bank is pointless.
100% disagreed with regards this being pointless, since what the cryptoworld needs are bridges with the real world to bring the cryptoworld out of its wild west situation. Basic banking services operated by solutions having banking licenses is definitely a way forward rather than being pointless.
The day crypto is regulated banks will pounce on it and have services ready at super fast pace. Banks aren't stupid, they can sniff money making opportunity faster than anyone else. And how will this bank be regulated if crypto isn't. Pointless from start to end.
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Everything is changing all the time, also the somewhat regulation of crypto which is already ongoing with many of the exchanges asking for KYC, and some of the countries having laws about crypto currencies. Why can't a new type of bank enter the market? I have many examples of new style banks having a total different approach to the traditional banks. The Dutch Bunq is one of those examples. A 100% online bank but offering all the necessary banking products (App, Payment card, integration with the standard PoS), integration with all the other traditional banks to allow interbank transactions and so on. Not on a blockchain yet, but definitely a bank doing it differently; They for instance will not touch the money of their customers, they pay their business from the bank account subscription fee they ask. Setup by someone who wants to evolve the financial sector, and this guy who launched this bank, is one of the leaders in innovation in the financial sector and actually not really much liked by the traditional banks. That said, his company is growing a lot. Unfortunately he struggles to make black numbers, but that said, I'm in favour of these new type of banks with totally different business models and approach to finance. What I've seen of BABB, they have the cards right to do something similar to what Bunq did.
There is no problem to a new approach to financial services. There are many wonderful start-ups that have changed the way traditional finance worked. However, blockchain will slow a fast paced fintech or a bank. Centralised decision making is fast and great. Bitcoin already takes away the concept of trust on which banks are based. Bitcoin is a bank in itself. Its self custody as opposed to 3rd party custody.
What do banks do, borrow money from depositors and lend? Then they provide investment banking and trading and custody service? With bitcoin, they will continue to borrow from capital markets.. they can price risk better and therefore can lend better. Their fee based businesses will probably never be destroyed. Custody will be destroyed whether its money or securities.
Even if a fintech can price risk in new ways, what is the advantage of blockchain? Its just a buzzword everyone keeps throwing around.
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Well, I agree blockchain is not he holy grail for everything, but it has certain features that'll be great for new style banking. I do trust Bunq they are not touching my money, but when they would have used a blockchain to record my account, I would have instant trust in Bunq they will not touch my money. The trust in the traditional banks most of us have, regardless what they cause and regardless how some of them enrich themselves in ways far from acceptable, we still have trust in our money is save at these banks. That trust is something that will keep the traditional banks in their position for a long and maybe very long time. BTW, fees are needed to pay for the operation. Blockchains create tokens and give part to everything to the miners, but nothing to the companies that actually create a service using a blockchain. These service creators need ways to pay for whatever they create, make and market. I do like all these new companies that only take a subscription fee and no margin on what they re-sell, like the new style energy companies in western Europe not adding a margin to the energy and gas they sell, but live from a small subscription fee. These companies grew a lot in last years in my little country the Netherlands, and are becoming more and more relevant.
My problem is with careless use of blockchain by everyone. Banks or even fintechs tend to be super regulated and are safe, banks more than fintechs and there is no dodgy business of speculating going on in new banks. I myself have preferred a few fintechs over banks for fx, loans and saving, while i was in the uk. Banks need to be transparent and rule based.
Anyway, thanks for an engaging thread though.
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Thank you as well :)
Indeed. 'bank' and 'blockchain', two words that won't match.