Bitcoin Forum

Centralized banks versus decentralized banks.

Which paradigm is better?

I think we can agree each model has its pros and cons. Advantages and disadvantages. Historically, attempts at breaking down the fundamental differences between these two systems do not exist. Academically, this isn't a topic anyone pursues to my knowledge.

It could invoke free markets, monopolies, protectionism, competition and any number of abstracts that are commonly touched upon. Even if the topic isn't addressed directly we might infer some analysis via analogy.

Anyways, long story short. What's your take on this? Share your $0.02.

Since the core philosophy of bitcoin is to be your own bank my 0.02$ is on a decentralized bank system like bitcoin. The user should be careful and should be responsible for all of his actions and this is maybe why many people still want more a centralized system as if the user makes an error there is room for correction. In a decentralized system is different, if a user makes an error, no way to recover it at all. Still I prefer decentralized system.

Centralized banks have one good thing - if you made a mistake or your money were stolen by scamers you always can go or call to the bank and ask manager help you to solve your problem, but there one little tning - very often centralized banks are the biggest scamers, who don`t want to solve problems, and just want to take money from your pockets.

In my opinion both centralized and decentralized systems have common disadvantages its unsafe. I do prefer decentralize banking systems, its more convenient and I can access my funds anytime I want unlike traditional banking system a lot of barriers and hassle before you can access your funds. In terms of security both have vulnerabilities, In bank you don't have full control of your funds and bankers can run away from you however decentralize system can crash and vanish without prior notices.

What more could you ask for If you are in full control over your funds with the decentralized systems? I don't see any cons about this honestly and that's something that cannot be said about the traditional centralized banking system and yes, that include the ability to chargeback, It's your fault for trusting random people and services on the internet, do your own research instead of paying and then crying about not being able to reverse your transaction in bitcoin.

Each model has pros and cons but central banks are more secure compared to the decentral banks despite they never exist on the earth. At least, you don't worry about your money while they're in a central bank.

For banking to be financially inclusive, fair and globally connected a decentralised model certainly makes sense.