Bitcoin Forum

Bitcoin 'doesn't solve a main need in society right now,' says Royal Bank of Canada CEO

From JPMorgan's Jamie Dimon, to the IMF's Christine Lagarde, bitcoin has become a major talking point for the finance world's established voices.

Now Royal Bank of Canada CEO, David McKay, is joining in calls to question the utility and legitimacy of bitcoin.

"The purpose it [bitcoin] seems to serve today is really to help move money in a hidden way and facilitate, potentially facilitate, criminal activity of moving money in an undetected way," McKay told CNBC in an episode of Life Hacks Live.

"I think some people will call it a fraud. I don't think it's fraudulent … But it doesn't solve a main need in society right now."

McKay doubts bitcoin's legitimacy in the face of the pound, euro or dollar.

"A currency is a promissory note on a future good and service and economy. I hold a dollar, or a pound, or a euro because I want to exchange it for physical good or a service sometime in the future and I'm confident in holding that note because of the political system backing it, because of the strength of the economy, because of a central bank with reserves."

"So when you look at those characteristics and the real need for a currency, how do you apply that to a cryptocurrency? Most of those criteria don't fit; it's not backed by a government, it's not backed by rule of law, it's not backed by economy, there's no reserve against it, you actually have to mine it in a distributed chain environment," said McKay.

Though bitcoin may "serve a need in the future" in reducing the friction in moving money, it's potentially illicit activity means it's in need of regulation, said McKay.

It's the technology underpinning bitcoin rather than the cryptocurrency itself that excites the CEO.

"Most people in the world aren't talking about bitcoin. They're talking about blockchain, the distributed ledger private or public that underpins the bitcoin application of it," said McKay.

"It has a chance to transform everything from our capital markets, and our trading businesses, our security settlement businesses, right into our retail franchise. And so that technology, that ability to work in code and build solutions, are two new technologies and areas that we need."

On the evolution of the banking sector, McKay sees a huge change already.

"When I grew up in banking we were like an enclosed industry. We built everything ourselves, we managed everything ourselves, we interacted one on one with the client."

"Today, banking is about partnerships with fintech, with technology companies, bringing in new ideas, building innovative solutions quickly, breaking them down and rebuilding them. It's a completely different industry," said McKay.
Source: https://www.cnbc.com/2017/10/23/bitcoin-does-not-solve-a-main-need-in-society-royal-bank-of-canada-ceo.html

How ironic is this? -> http://prntscr.com/h11d96 {The one thread asks the question and the next thread answer the question}

Venezuela is fighting hyperinflation in their country with the help of Bitcoin. Venezuelans cannot store their wealth in their

local currency, because poor government decisions and politics are destroying their wealth... Bitcoin is their solution.  ;)

Hah, I was thinking the same thing. I searched bitcoin on google news and saw the OP's article. 3 articles down I saw this:

Bitcoin is breaking all kinds of price records in cash-strapped Zimbabwe

Bitcoin has a public ledger, so it's much less hidden than some offshore bank account. Ability to trace transactions has been around for quite a while and criminals are moving away from Bitcoin to more privacy-based cryptocurrencies like XMR.


Bitcoin is backed by community and it's better than being backed by some government, as there are countless examples of rapid devaluation of national currencies.

Exactly, and Using bitcoin ' to help move money in a hidden way' doesn't mean that it will be used on illegal activities, Bitcoin gives protection and anonymity and also it is backed by the community. But i disagree that it's better that Bitcoin should be backed up by some Government. It is better that they will give fair regulation on how to handle bitcoin.

But it is? Do they have an idea that Venezuela and Zimbabwe are not in a economic crisis and bitcoin is their safe haven? This people should have known better, they are in the position to see how bitcoin is being used today but a lot of people specially economic stricken nation. Those bankers are really on the offensive and very opinionated about bitcoin. And you will hear, regulations, regulations, regulations. Bitcoin indeed have tried to regulate itself by getting SEC approval but they turn it down. And I don't know what kind of regulations they really wanted.

When you are exchanging cash you are also moving money in a hidden way. Why don't you oppose that mr banker?
Those who call it a fraud are simply fearful of what they don't understand. They were raised in belief that the government always has a backup plan and will take care of its people, which is a lie.


One thing hasn't changed. This new industry is still watching you and stealing from you just like they were 20 years ago.

With the transactions that take place and the consensus rules, BTC is the most transparent monetary system in existence. Banks and the IMF can commit fraud and create money out of thin air - both of which they do on a regular basis.

Sure, the individual may be able to stay private a lot of the time, but that's fine.  Cash works in the same way but without it being clear where the cash came from.

I suppose what they were hoping for was a clean and slow transition to a cashless society, but now it seems impossible.  If cash is gone there can be a new digital system to take its place, or perhaps commodities and assets like gold which are perceived to have value.

I am looking for something from the statement of this guy on which i can partly or wholly agree. At least I find something. I agree that Bitcoin is not a fraud and David McKay disagreed with the famous Jamie Dimon on this point. Here, there is something of an improvement from being a fraud according to Dimon and not a fraudulent according to McKay. In fact, I like the name McKay much better then Dimon which rhyme with the name of someone in hell.

Now, all of these statements and analysis from a banking CEO are just rehashed and there is nothing new here. These guys are now sounding like duplicates and they are spreading all of these comments using the mainstream media assuming that we are not aware that they are protecting a big industry which can be disrupted once Bitcoin would succeed its overall mission. They want to limit the growth of Bitcoin otherwise there might only be small left for the banking industry.

I agree that Bitcoins or digital currencies alike do not solve the financial crisis the people are experiencing at the moment. While the latter statement may be valid, I still take on the side that these digital currencies help solve unemployment rate worldwide. Imagine how many people have access to the internet and how much they could earn just by using it? While it is not a solution to the current crisis, it still helps alleviate falling economies by increasing the purchasing power of the people thereby effectively regulating the chain of supply and demand.

The problem now revolves on governments on why, knowing the emerging growth of digital currencies, they have not addressed the issue squarely?

He is talking out of his arse, trust me, the so called experts don't know any better than you and me. They are all making it up as they go. Bitcoin does not meet any need but FIAT does? whose needs if I may ask? So far as the community use it as an exchange of value, it satisfies every need.

Absolutely, bitcoin can not solve the financial crisis but it has a big help to those people who really need extra money all over the world, digital currency has a big help to cut the poverty eradication more people who are unemployed are able to earn in bitcoin freely to sustain the needs of their family. Most of the people now are earning using internet connection thru online job and digital currency is one of the best source of income right now in online. I want to make government to do big step to make digital currency adopted each in every country because it is a big help to improve the economy of one country.

Even with real money and using real banks in the real world people can still do this things if they want to and they are no exeption so as Bitcoin so they can throw anything but at the end they are not safe in what they are saying about Bitcoin.


It doesn't solve the main need of society right now then do they? There is no perfect thing in this world and everything has it flaws and short comings and I think Bitcoin is way much better that Banks when it comes in sending faster and cheaper transaction in the whole world plus the fact that there is no hidden charges in the long run.

Well they are defending their empire which is the bank so it is not surprising that they would say something like this. It may be effective for the people who doesn't know bitcoin but for those who are already in the community knows that it is the negative side of bitcoin but it has more positive side also which they don't expose that much. There's no need to explain it to the people who are here in the forum but we as a community should spread the word as well the positive side of bitcoin if we wanted people to know that its just media manipulation and there's more to bitcoin than just being a currency for illegal activities.


Obviously, they are just closing their eyes to the reality that it is already solving the problem of some countries right now. Those who are experiencing hyperinflation find refuge in bitcoin so they just cannot easily say that it doesn't solve a main need in society now.

Because in the first place “experts” as they call themselves are paid by the same institutions that has always criticized cryptocurrency. They don’t really know and I’d they do have they just make it hidden for they’re professional towards the one who employed them won’t transfer they’re hatred to that person. We can’t blame the “experts” for they need money to tell lies for they’re survival.

I suppose in a way it's obvious that a bankster wouldn't understand the "need" of not relying on banksters.  Either they're completely blind when it comes to their own shortcomings, or they're so arrogant that they simply can't grasp the harm they do to their customers when their banks fail.  The "need" for Bitcoin is having a safe haven from the almost inevitable implosion of the legacy finance sector.  Whether it be through corruption or sheer ineptitude, banks are increasingly likely to start falling like dominoes as the real murky underground of money, derivatives, become an ever larger looming shadow over the "traditional" economy and governments increasingly go down the route of financial deregulation.  It's a ticking time bomb.  Conversely, Bitcoin's network likely won't be affected by rampant derivatives speculation and doesn't require regulation to remain clear, transparent, neutral and largely predictable.

The need is real.

Don't believe all of these big companies knocking it so they can buy it cheap and the public doesn't know about it lol. So stupid. It is when they're wealthy and benefitting that they embrace it publicly.

Yes, I believe that bitcoin does not clearly provide anything for society. Instead it's used for luxuries. Many are saying that this would help somehow but until today, I can't see any development. Maybe the convinience of bitcoin is for rich people only. Rich going richer. Maybe bitcoin can be a charity but since prices are rising I think greediness sprouts from every single user today.
I would really like to see how a poor person got on their feet because of btc. Or a project of charity for homeless.

"McKay doubts bitcoin's legitimacy in the face of the pound, euro or dollar." I`m agree with him. No matter how beautifully they describe bitcoin and how fast it developes, he loses the advantage over living money. We will see how it will be in the future.

This human thinks about bitcoin users as dumb.. We always talk about them for a reason they don’t agree with us is the wrong thing.. Sometimes ignoring them is the easiest way to do it.. We can’t correct them because they’re pride is bigger than they’re brain.. We can’t save them from they’re ignorance because money is more powerful than knowledge..

You must be blind if you can't see any benefits for society. A poor person won't become rich thanks to BTC but it's not how it works. You can't repair the world by giving people a decentralized currency, but every person will in a way profit from using it. For instance you are safe from government interference. Nobody can take your coins from you and nobody can charge you fees for moving your wealth from country to country. A poor person won't become rich, but a moderately wealthy person won't become poor either, which is a big step forward.

Just let them talk this and that. I really don't care about what they say because for me these kind of people that will bow down to bitcoin in the near future.

The main problem of all who are now recognized as a financier is that they grew up in the existing financial system of the closed type. They knew politicians and their plans and therefore had an advantage before the people. That is where all their capital. They do not know how to work in a decentralized environment. Bitcoin scares them. That's why all the bankers against bitcoin and their knowledge in the modern world nothing.

Bankers will come up with new reasons for not taking bitcoin. And they will say that only banks remain reliable, and bitcoin is a bubble. So they are protected. But bitcoin will change this world

Many hundreds of thousands of people believe that bitcoin and other crypto currency not only performs all the usual functions of money, but in many ways surpass them and express unanimous support for the crypto currency, and only one of the few believes it is the other way around. Well, let him think so. We, after all, have freedom to express our views, but why should his thoughts, which express a negative assessment of the crypto-currency, be constantly quoted? Do we have any other authorities in the field of cryptography?

The fear of crypto currencies will always has place to be among all those "experts", just cause of they invested in something totally different like banking or oil mining, but now appeared such strong and fast developing competitor as bitcoin and they just don't know what to do with it, cause the capita flom their investment is slowly going to bitcoin and other crypto currencies.
But it is not right to ignore their opinions and sayings and to listen only those experts who support bitcoin. I prefer to listen both opinions. That's much more interesting provoke me to build my own opinion.

If we really believe in crypto currency and bitcoin, then we should not pay attention to such statements. They will always be. There are always dissatisfied people. I do not take seriously the talk that bitcoin is a bubble