Bitcoin bank accounts - maybe sooner than we think?

[CIYAM]

Some thoughts:

1) China is unhappy with the US printing money (just Google it).

2) China seems to be warming to Bitcoin more and more (it was on the CCTV news recently and not negatively portrayed).

3) China has called for a *new world currency* (again just Google it).

4) China has the majority of ASIC production.

5) Chinese banks already let you buy PMs (gold and silver).

How long until Chinese banks let you create accounts in BTC?

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[mel2000]

You would trust your entire Bitcoin safekeeping to China?

[jawnzer]

If there is any way for a bank account to hold BTC, then be able to use at POS/ATM as fiat or use at BTC supported locations I would be in. But would have to be a Canadian company doing this.

But we do have Coinkite/Virtex doing something similar

[giantdragon]

You would trust your entire Bitcoin safekeeping to China?

If there would be interest on balance AND deposit insurance I would try.

[franky1]

proper long term savings accounts where banks can use and abuse our funds, i dont think so.
especially not for a measly 1-5% return

 but small 'pocket money' sized accounts to deposit into (to get preconfirmed) and then used for instant 'off the chain' transactions with retailers like starbucks, mcdonalds and other small priced items would be an advantage

[datafish]

What I'd really like to see are more Chinese merchants who accept Bitcoin.  Does any sort of directory exist?  It would be nice if Alibaba supported Bitcoin.  That would really accelerate adoption!

[foggyb]

Why would you centralize something which essence is being decentralized?

I am seeking a patent for water that isn't wet.

[Baitty]

I don't think banks are fit for Bitcoin. They are not needed and defeats the object of Bitcoin.

[Ledeci]

I think it will never happen...
If so it wouldn't run long USA officials will complain....

[Birdy]

Why would you centralize something which essence is being decentralized?

I am seeking a patent for water that isn't wet.

Ice?

[dalston5000]

but I am my own bank for my bitcoins.. :|

[franky1]

where banks use to have their niche was as the secure store of gold so that average joe did not have to be weighted down, instead they were given receipts (more commonly bearer bonds/ IOU's) promising the person holding the note that they can reclaim the gold on demand.

those days have gone.

the whole FIAT system now is dying, because the currency amount printed on it, is not worth the paper its printed on.

but what i do see as a possible use of a 'centralised' system to still exist is for ensuring instant transactions without the whole confirm 10 minute waiting periods. which would mainly be beneficial for the small priced stuff that shops would hate to have customers waiting 10 minutes to process.

stuff like cars and houses, yea i accept having to wait 10-20 minutes to guarantee payment. but a sandwich or a cup of coffee, i wouldnt want to have to hang around for,

so having a service where by, for instance 'bips' or 'bitpay' were the centralised service. people can have a small account for putting in under $100 worth of funds (not requiring ID checks and other red tape) and the customer because the funds are pre-confirmed within bips/bitpay, can then use those funds to pay starbuck, a bar or walmart instantly without waiting. because bips/bitpay simply do a database balance alteration (off the blockchain) between customer and merchant.

this is where i see the future of banking being. small transactions using Apps to make instant transactions fast and easy to use. and to quote the credit card company "for everything else there is" bitcoin-QT

[Shawshank]

I don't think banks are fit for Bitcoin. They are not needed and defeats the object of Bitcoin.

I can imagine people uploading some of their bitcoins to a "bank". This will enable instant transactions of Bitcoin IOUs, trust-based paths among its members, and instant transactions with bitcoins for merchants which trust that "bank".

[ShadowOfHarbringer]

those days have gone.
the whole FIAT system now is dying, because the currency amount printed on it, is not worth the paper its printed on.

+1

but what i do see as a possible use of a 'centralised' system to still exist is for ensuring instant transactions without the whole confirm 10 minute waiting periods. which would mainly be beneficial for the small priced stuff that shops would hate to have customers waiting 10 minutes to process.

stuff like cars and houses, yea i accept having to wait 10-20 minutes to guarantee payment. but a sandwich or a cup of coffee, i wouldnt want to have to hang around for

Again, +1

[Kouye]

Why would you centralize something which essence is being decentralized?

The beautiful idea with bitcoin is that you are FREE!
You wanna give all your wealth to a centralized institution for a promise of steady interests? You're free to do so.
You don't wan't? You just be your own banker, send wealth to whoever you want, and fuck everyone else.

That's why Bitcoin will be around tomorrow. Your decision. You have the power.

[doof]

Why would you centralize something which essence is being decentralized?

Because the mum & dads dont want the hassle of securing their own btc.

[gaston909]

Why would you centralize something which essence is being decentralized?

Because the mum & dads dont want the hassle of securing their own btc.

AGREED!!

Wouldnt personally keep a ton of coins in the bank but it would be nice to have the option.

[Twipple]

Two words, Neo & Bee

[StarfishPrime]

Paypal has been hinting that they may add xbt to their list of currencies in the future (they already allow users to hold funds in a large number of different currencies and exchange between them).

Paypal would instantly become the largest bitcoin wallet, bank, merchant service and exchange in the world by several orders of magnitude with 200+ million users in almost 200 countries.

[ShadowOfHarbringer]

Paypal has been hinting that they may add xbt to their list of currencies in the future (they already allow users to hold funds in a large number of different currencies and exchange between them).
Paypal would instantly become the largest bitcoin wallet, bank, merchant service and exchange in the world by several orders of magnitude with 200+ million users in almost 200 countries.

...not even saying that value would skyrocket by 1000% in a day... or week maybe ?

[Kouye]

Paypal has been hinting that they may add xbt to their list of currencies in the future (they already allow users to hold funds in a large number of different currencies and exchange between them).

Paypal would instantly become the largest bitcoin wallet, bank, merchant service and exchange in the world by several orders of magnitude with 200+ million users in almost 200 countries.

Paypal, if even alive at this time, will crawl and beg for bitcoin users to consider them as a possible gateway.
Bitcoin users will then decide if paypal must live or die.
And it will die.

[StarfishPrime]

Paypal has been hinting that they may add xbt to their list of currencies in the future (they already allow users to hold funds in a large number of different currencies and exchange between them).

Paypal would instantly become the largest bitcoin wallet, bank, merchant service and exchange in the world by several orders of magnitude with 200+ million users in almost 200 countries.

Paypal, if even alive at this time, will crawl and beg for bitcoin users to consider them as a possible gateway.
Bitcoin users will then decide if paypal must live or die.
And it will die.

I'd like to believe that could happen, but there's just too much smart money behind paypal/ebay for that to ever play out. I suspect we may see something sooner rather than later, and if it does happen, all bets are off regarding btc/usd rates.

[Kouye]

[...] smart money [...]

That's the point. With BTC, money is as smart as the people who "own" it. Period. 

[pedrog]

Two words, Neo & Bee

This ^

[DannyHamilton]

There are already several bitcoin banks and they are all already quite popular (inputs.io, mtgox.com, bitstamp.com, etc)  Or are you talking about insured, regulated accounts?

[CIYAM]

Wow - quite a few replies - and some good points.

Where I see *banks* fitting in is simply giving you the convenience to transfer funds in and out of BTC via online banking and in insuring your BTC asset (something that I think might be important to those less tech savvy than many of the members of this forum).

[justusranvier]

Many people will think that giving their bitcoins to a third party to hold for them is a good idea.

They'll learn their lesson, sooner or later.

[ar9]

I really do not see the need or purpose of a Bitcoin bank.
I would employ anyone who thinks they need this service to look into Bitcoin security measures for themselves.

Once banks get involved, Bitcoin's ultimate purpose is undermined to a rather extensive degree.

[hayek]

You would trust your entire Bitcoin safekeeping to China?

Don't have to. I'm my own bank

[CIYAM]

The point that is being missed is insurance - if you're computer gets hacked and you lose all your BTC then it's simply "tough luck".

Devices like the Trezor may get us there without the need of a 3rd party but I think given the option quite a few people (especially the elderly and non-technically minded) would rather trust a bank than themselves.

[justusranvier]

The point that is being missed is insurance - if you're computer gets hacked and you lose all your BTC then it's simply "tough luck".

You're assuming that it's possible to create workable deposit insurance for BTC.

Central banks get away with it by using the printing press and taxation, when they choose to protect depositors at all.

[CIYAM]

The point that is being missed is insurance - if you're computer gets hacked and you lose all your BTC then it's simply "tough luck".

You're assuming that it's possible to create workable deposit insurance for BTC.

Insurance would most likely only be in the form of fiat - but I would rather get back 90% of the current fiat value of my BTC than to lose it all to a hacker.

[Shallow]

I doubt bankers would initiate mass adoption.

[LiteCoinGuy]

dont think so but for normal people it would be a nice idea. the normal guy who isnt tech savy dont want (or should) have his money on a computer.

maybe some day, the Fidor Bank in germany will do it. until now they work together with the biggest german exchange bitcoin.de

[romerun]

if paypal add btc, we'll laugh at dwolla to throw their lead away

[bluemeanie1]

You would trust your entire Bitcoin safekeeping to China?

If there would be interest on balance AND deposit insurance I would try.

I show how it can be done with Confidence Chains : https://bitcointalk.org/index.php?topic=324106.0

You can get FDIC insurance by simply opening a real bank account and then basing the asset on the deposits in that bank account.  Thus you have a crypto-security that is FDIC insured(more or less).

Given what's been happening in the banking world I think the stronghold of FDIC might even come under question at some point in the future.

People can design any kind of investment device they want with the Bond Auction system, you can loan money out to your friends and your interest comes from their successes.  To build more stability create a fund and a pool of loans.  Sounds more like something Bitcoin people could appreciate.  Remember when you open a savings account with Wells Fargo, your money is going to all the people who are consistently reviled on this list.

[RoadToHell]

I don't know how it would be implemented but it is quite possible that private wallet insurance might emerge.  It might be offered as a an option with a trezor-like or other physical wallet product.

[bluemeanie1]

The point that is being missed is insurance - if you're computer gets hacked and you lose all your BTC then it's simply "tough luck".

Devices like the Trezor may get us there without the need of a 3rd party but I think given the option quite a few people (especially the elderly and non-technically minded) would rather trust a bank than themselves.

I tend to think that people would develop better personal security systems if there was a need for them.  You could rig up some kind of system using very cheap commodity hardware, smart cards, etc. to make a crypto-bank account possible on a PC with open source software and less possibility of misplacing your credentials.  I just dont think there is much of a need at this point, Bitcoin is only used for a few classes of transactions.  At one point they tried to work SmartCard readers into Mozilla.

here's a USB Smart Card Reader for $15.99  http://www.staples.com/office/supplies/StaplesProductDisplay?storeId=10001&catalogIdentifier=2&partNumber=IM1RH9702&langid=-1&cid=PS:GooglePLAs:IM1RH9702&srccode=cii_17588969&cpncode=33-197953902-2

[Heutenamos]

You're assuming that it's possible to create workable deposit insurance for BTC.

It is as long as bank has physical assets (these can be sold off to buy stolen BTC back)

[justusranvier]

I don't know how it would be implemented but it is quite possible that private wallet insurance might emerge.

I'll believe it as soon as someone presents a pricing scheme for it that is both affordable and actuarially sound.

Insurance isn't magic pixie dust - doing it correctly means having the ability to accurately calculate the risk of insured losses, and for that risk to be low enough that customers are willing to pay for it (either directly via premiums, or indirectly via opportunity cost).

[RoadToHell]

I don't know how it would be implemented but it is quite possible that private wallet insurance might emerge.

I'll believe it as soon as someone presents a pricing scheme for it that is both affordable and actuarially sound.

Insurance isn't magic pixie dust - doing it correctly means having the ability to accurately calculate the risk of insured losses, and for that risk to be low enough that customers are willing to pay for it (either directly via premiums, or indirectly via opportunity cost).

I agree.  By "how it would be implemented" I was thinking that it will necessarily be bound to the wallet owner following some provable steps of safe keeping.  After all, one of the events that you would want insured is the theft of btc by sweeping into another wallet.  So there would need to be a way to show that the policy holder wasn't just stealing their own money and then putting in a claim.

[toy4lov3rs]

I don't know how it would be implemented but it is quite possible that private wallet insurance might emerge.

I'll believe it as soon as someone presents a pricing scheme for it that is both affordable and actuarially sound.

Insurance isn't magic pixie dust - doing it correctly means having the ability to accurately calculate the risk of insured losses, and for that risk to be low enough that customers are willing to pay for it (either directly via premiums, or indirectly via opportunity cost).

I agree.  By "how it would be implemented" I was thinking that it will necessarily be bound to the wallet owner following some provable steps of safe keeping.  After all, one of the events that you would want insured is the theft of btc by sweeping into another wallet.  So there would need to be a way to show that the policy holder wasn't just stealing their own money and then putting in a claim.

But I assume the bank would have exclusive control of private key. And yes if someone confirm transaction with password+SMS code+yubi key he cant complain it was not him

[Kenshin]

You would trust your entire Bitcoin safekeeping to China?

Why not? I trust China more than America or Britain. If it wasn't America or Britain. We wouldn't have so many war or economy crisis.

[CurbsideProphet]

Why would you centralize something which essence is being decentralized?

I am seeking a patent for water that isn't wet.

Ice?

Technically not water, it's ice.

Technically it is water.  Ice is just one state of water (solid), the others being liquid and gas.