Cryptocurrency Banks: needed?

[pereira4]

Anyone knows if there already exists such an idea of Crypto bank?

Xapo is a crypto bank in a sense. They are custodians of thousands if not hundred of thousands of private keys which are held by them, and it's their responsibility to keep them safe. Apparently they have an underground cold storage bunker somewhere in switzerland, we have at least picture evidence and im sure there are videos so we can assume that it's all real, im not sure if they've been audited. I would know all of these details if I was choosing them to hold my money obviously, but the idea is that they are indeed a bank. You should also look with massive detail about how much of what you are holding will they cover in case of bankruptcy. Since they are a private company, it could be that you would lose everything in case they file for bankruptcy, so have that in mind.

[audaciousbeing]

Thinking of certain investments in the project where they are planning to arrange a cryptocurrency bank! And I saw discussions about cryptocurrency banks and their "place" in our crypto-future, and, which is even more interesting, noticed that there is quite a number of those who are of the opinion that there is no need for cryptocurrency banks at all. Well, guys, we can discuss that forever, but how do you imagine then the communication with the so-called real world for the sake, e.g., of making deposits or obtaining a loan? How can the whole system function properly without cryprocurrency banks, which are anyway somewhere on the border between the real and crypto worlds?

Banks in crypto is a complete opposite of the essence of bitcoin and would defeat everything that bitcoin stands for which is decentralization. Banks don't become banks because they keep money or they accept deposits or issue loans at an interest rate but they are banks because they comply and continue to comply with the law of the land being overseen by the central bank.

Coming to the crypto bank, who then makes the law, who issue the license, who collects the insurance deposits, who confirms the appointment of directors, who ensures that best practice is kept to the highest level and a host of other conditions that must be met for any business to be regarded as a bank. Ensuring all of this in place has defeated the essence of crypto currencies.

Anyone knows if there already exists such an idea of Crypto bank?

Xapo is a crypto bank in a sense. They are custodians of thousands if not hundred of thousands of private keys which are held by them, and it's their responsibility to keep them safe. Apparently they have an underground cold storage bunker somewhere in switzerland, we have at least picture evidence and im sure there are videos so we can assume that it's all real, im not sure if they've been audited. I would know all of these details if I was choosing them to hold my money obviously, but the idea is that they are indeed a bank. You should also look with massive detail about how much of what you are holding will they cover in case of bankruptcy. Since they are a private company, it could be that you would lose everything in case they file for bankruptcy, so have that in mind.

The last part of your message only shows that Xapo is just a wallet service provider that provide services similar to a bank but not a bank.

[bitbunnny]

To my opinion yes, we need some kind of cryptocurrencies banks. I think the gap on the market that we have now because of Bitcoin debit cards withdrawal cleary shows that. The first financial institution that establish Bitcoin bank and all related services will have great success.
And existance of Bitcoin bank doesn't mean Bitcoin centralization, these could be two totaly different things.

[innocent93]

Thinking of certain investments in the project where they are planning to arrange a cryptocurrency bank! And I saw discussions about cryptocurrency banks and their "place" in our crypto-future, and, which is even more interesting, noticed that there is quite a number of those who are of the opinion that there is no need for cryptocurrency banks at all. Well, guys, we can discuss that forever, but how do you imagine then the communication with the so-called real world for the sake, e.g., of making deposits or obtaining a loan? How can the whole system function properly without cryprocurrency banks, which are anyway somewhere on the border between the real and crypto worlds?

Well the entire crypto world started from the idea that we don't want anymore banks, taxes and so on so why should we think at a cryto bank....there is no need for it

[richardsNY]

For me personally? No. If we look at how the average person doesn't want, or at least doesn't care, to be fully responsible for its own funds, then yes. This is a market based on supply and demand, and as long as people think centralized services offer them the usability and convenience they are looking for, it automatically means that the demand is definitely there, and the services offering all this as well. I have no doubt that Coinbase, which more or less can be seen as a Bitcoin bank already, will at some point offer actual bank-like features to capitalize on their significant market position. I however like to see more services end up doing this, because at current rate, Coinbase is going to dominate this market with iron fist....

[Tyrantt]

They are needed, like it or not. As you said, we need loans, we need creditors, and we need to be able to hire someone to hold custodian of our keys because we don't trust themselves (some people find it easier to pay someone to hold your bitcoins rather than having to trust yourself to remember passwords, for example I have lost access to some hard drives which I encrypted and now I can't access them because I forgot the password) so yes banks are needed. The question is, are they going to adapt, or are they going to try to endlessly try to crush bitcoin (which is impossible and a waste of time and resources).

I don't think so, banks aren't needed, for every example you've given it's only a preference, it's not a must.

we need loans, we need creditors, and we need to be able to hire someone to hold custodian of our keys because we don't trust themselves.

You can get loans from other people, you can get leans here on the forum. Well you not trusting yourself is kind of your own problem, you don't need to leave it for someone else to keep it for you but you'd like to.


No, crypto banks are not needed, because in some way you already have a crypto bank. There's nothing you can't do right now with crypto that a bank would be able to provide.

[kengeorge21]

I don't mind having one in the industry and i think different class of business equipped with blockchain or cryptocurrency will be good for this cryptocurrency market as long as this cryptocurrency banks will secure its investors and having less to non scam issue because financial institution like that will work if they get the trust of the community.

[azguard]

For this it could opinions divided cuz if we look how normal banks do dont think that this crypto bank will do anything different maybe it could be even worse. And on top of that who will be the first one to open it what will it be like, will it allow credit loans like real one even can it be purchasing cars or house/apartment. This for me opens so many questions with so little answers.

Maybe we could wait little with this idea, concept for this i believe is good, but we could always expect to see something that we didnt wanted to see.

[SonOfNorth]

This is a horrible idea, and goes against the whole principle of cryptocurrencies. But I do agree that there will be cryptocurrency banks (which undermine the whole concept), because you simply cannot the the average person be responsible for their own finances. People already dick around with their cryptocurrencies way too much, and so far we have mainly tech savvy people on board. I can't even dare to imagine the Average Joe jumping along...

[Tharel]

Bitcoin has survived without banks or financial institution so I don't think they are needed in anyway. It might further create conflict of interest or may start controversies if bitcoin will be entrusted to banks.

[rancidgash]

For this it could opinions divided cuz if we look how normal banks do dont think that this crypto bank will do anything different maybe it could be even worse. And on top of that who will be the first one to open it what will it be like, will it allow credit loans like real one even can it be purchasing cars or house/apartment. This for me opens so many questions with so little answers.

Maybe we could wait little with this idea, concept for this i believe is good, but we could always expect to see something that we didnt wanted to see.

The world's first Bitcoin bank opened in the capital of Austria. The Bitcoin-Bank financial institution, dubbed the virtual currency, enables its customers to exchange euros at Bitcoin and vice versa, as well as receive a variety of currency information.

[altcointalk14]

For this it could opinions divided cuz if we look how normal banks do dont think that this crypto bank will do anything different maybe it could be even worse. And on top of that who will be the first one to open it what will it be like, will it allow credit loans like real one even can it be purchasing cars or house/apartment. This for me opens so many questions with so little answers.

Maybe we could wait little with this idea, concept for this i believe is good, but we could always expect to see something that we didnt wanted to see.

The world's first Bitcoin bank opened in the capital of Austria. The Bitcoin-Bank financial institution, dubbed the virtual currency, enables its customers to exchange euros at Bitcoin and vice versa, as well as receive a variety of currency information.

The purpose of creating the bank is that the purchase of the virtual currency is times faster than other currency transactions and can be performed without an intermediary.

[Perseusallen]

i think we should have that. but its too risky. maybe the government are thinking too. what if they will build a crytptocurrency bank. then it should be published worldwide so all of this cryptocurrency holders around the world would be aware of it. bitcoin should have a bank although no one owns it. cause all of the people in this world have an knowledge about bitcoin right. we should have it cause we want to become decentralized too.

[Bolt Brownie]

At first glance I think using a bank to hold crypto is not aligned to the crypto purpose. One of the points of crypto being decentralized, is to empower it's users and make them independent from centralized institutions like banks. You can be your own bank and control your money. But then I imagine a world in the futures, where all we have is bitcoin. I don't know if I would feel comfortable in keeping access to all my economies by holding a private key. Not saying this is not secure, but this could incentive criminals to try to get that key from me, and then transfer all my savings to their accounts.

Since crypto is suppose to be private as well, I would probably never see my money again. If my coins were on a safe place, this would not be possible. Even with online bank transfers, it would not be possible for someone to come to my house and force me to transfer all my funds to another account since the bank would not authorize this without me confirming the transaction.

Then we have loans services that banks offer. We don't really need banks for this though, since we have lending platforms emerging like Salt for example. But even though banks are not needed for this, we will need some sort of lending platform.

So maybe banks are not needed, but increased security (to store our private keys, not for the network itself), and lending platforms will probably be required.

[South Park]

Kind of a mixed bag on this one because on one hand it would be safer to have funds in a sort of decentralized bank if that is possible but on the same hand we have the bank in our hands which means we don't need bank access. It is however safer to have funds in a decentralized network than it is elsewhere but a bank safe is just as safe as this.

If you think about it bitcoin is already a decentralized bank in which each user hold his own coins in their own private bank, so why do we need centralized banks or even decentralized banks when we are already in one? This is what the bankers are fearing, they understand that bitcoin will completely destroy their business model if they cannot stop it before it becomes massive.

[btccashacc]

We don't need a bank, we already have our own bank it's called "wallet" a decentralized bank, actually cryptocurrency was created to take control over your money not giving access to a 3rd party that you called Bank. I just don't get it why do we have to need it while there are so many advantages by holding your money on your own private bank, at least your money will not be taxed and the bank can't freeze it or even lock it you have ultimate control over it.

[mone_to]

We think it would be great. What do you think about instant loans secured by BTC?

[pereira4]

They are needed, like it or not. As you said, we need loans, we need creditors, and we need to be able to hire someone to hold custodian of our keys because we don't trust themselves (some people find it easier to pay someone to hold your bitcoins rather than having to trust yourself to remember passwords, for example I have lost access to some hard drives which I encrypted and now I can't access them because I forgot the password) so yes banks are needed. The question is, are they going to adapt, or are they going to try to endlessly try to crush bitcoin (which is impossible and a waste of time and resources).

I don't think so, banks aren't needed, for every example you've given it's only a preference, it's not a must.

we need loans, we need creditors, and we need to be able to hire someone to hold custodian of our keys because we don't trust themselves.

You can get loans from other people, you can get leans here on the forum. Well you not trusting yourself is kind of your own problem, you don't need to leave it for someone else to keep it for you but you'd like to.


No, crypto banks are not needed, because in some way you already have a crypto bank. There's nothing you can't do right now with crypto that a bank would be able to provide.

Im not saying I don't trust myself, I hold my private keys, but not everyone trusts themselves, therefore there is a need for "crypto banks", like it or not, otherwise why isn't Xapo filling for bankruptcy? get real, there is a market there, a huge one actually.

[Pleione527]

I guess not anymore because it may only results to confusion since we already have the banks feature in our online wallet we currently used besides having a crypto currency banks may only lead to putting control over ownership of cryptos and having so much regulations which I don't think people will like. Let's just support our online wallets since they are very helpful and convenient to use.

[Lupus Solitarius]

Well, a bitcoin bank is just a philosophical contradiction,  because bitcoin was create just to allow people to not depend from banks.
But actually any online wallet that keep you private key is practically a bank!
Probably, they will start to offer typical bank services.

Btw, I don't trust them at all, and I prefer to keep my private key under my control.