Bitcoin Forum

Neobanks were created to have a wild-west playing ground again by evading regulations.

From a Neobank, customers can win big or get scammed big.
As usual for a bank, bank always makes profit. But for Neobanks, profits are even bigger because of evading regulation.

Sam Bankman Friend is an example of a Neobank entrepreneur. He created FTX.
What is your opinion?

Everyone needs a right guide...ether be guided by the Ultimate Guide who is the CREATOR of the Universe or by HIS law.
Not a good idea to follow a blind man with no right guide, or both of you will fall into a ditch.  So, the Neobank as explained is definitely bad for society because it has no right guide. It's like a wandering star drifting away aimlessly from the right course while crashing into objects on its path

Neobanks are digital only banks. They offer convenient & user friendly banking experiences. It’s tough to say if they are bad, that depends on your needs & preferences. Neobanks can provide lower fees, better interest rates & innovative features compared to traditional banks. The absence of physical branches & limited services can be a disadvantage. It’s important for you to research & consider your own banking requirements before deciding if a neobank is suitable for you.

Neobanks both have pros and cons that you could weigh depending on your preferences and goals

With technology developing, neobanks are surely catching up making it more convenient for their clients to access their banks however this kind of system makes it quite vulnerable to hacks and whatnot

On the other hand, neobanks which lack physical branches to maintain can ask for lower fee rates from their clients

At the end of the day, it is up to the client how they will use neobanks

It pretty much depends on the country and the context those Neobanks are being used. For example, someone living in the United States or the European Union could argue about this topic and say those platforms and services are a threat against the users who deposit their money there and they are mostly used to launder money, among other things. Though, those people who usually talk negatively about those Neobanks are citizens who are already fully banked and do not need to sign up on exchanges.

On the other hand, there is the population of developing countries and countries with a high inflation rate where people cannot simply store their savings in their traditional banks without feeling insecure about it, in those contexts, being able to have access to banking online where those reckless governments do no have any power, can be very useful to protect one's money. It is something I have seen myself happening here in my country, those online services still are popular and used to pay for many things.
People is thankful for their existence rather than scared of them.

Neobanks, like FTX by Sam Bankman-Fried, shake things up with more flexibility. Not all skip regulations, but the game's riskier like big wins or potential scams. Still, do your research before diving in!

They might have started as such, but escaping regulations wasn't their sole purpose. They just happened to be outside of any regulatory framework, but only because regulators were just catching up.
Compared to current huge exchanges, they were relatively small, and there were way more exit scams on them.

These days crypto exchanges or "neobanks" are obligated to follow same regulations as every company that deals with people's finances. Also profits and losses from neobanks don't happen because of evading regulations. Gains and losses are huge because you can basically trade any volatile token in them. At least in DeXes.

Ironically, much of the volume in developing countries where the use of those exchanges or Neobanks is high, is because of the number of transactions done in stablecoins, instead of tokens or volatile cryptocurrencies. People in those kind of context just want to have access to stable currency which does not easily suffer because of inflation, so they use their exchange accounts like literal bank accounts to save FIAT equivalent tokens.
In those cases, the losses because market fluctuation are only possible if people start to make bad deals on P2P platforms, where the difference between the purchasing and selling price is big.

Also, the Exchanges follow the regulations of the countries where they are based, but they do not follow those in countries where there is a conflict of authority or Power. Venezuela has its own regulation for exchanges and Crypto and neither Binance nor other exchanges follow it, in spite of being the most important custodial platforms used in the country.

Everyone needs a right guide...ether be guided by the Ultimate Guide who is the CREATOR of the Universe or by HIS law.
Not a good idea to follow a blind man with no right guide, or both of you will fall into a ditch.  So, the Neobank as explained is definitely bad for society because it has no right guide. It's like a wandering star drifting away aimlessly from the right course while crashing into objects on its path.Neobanks, like FTX by Sam Bankman-Fried, shake things up with more flexibility. Not all skip regulations, but the game's riskier like big wins or potential scams. Still, do your research before diving in!