Bitcoin and Banking

[sehdal]

Hello all,

As a newcomer to Bitcoin who invested a bit a few months ago. I'm interested in how people see the currency changing as it develops. I've read some people who argue that any currency needs a system of credit and banking behind it to be sustainable. Are we going to see the emergence of Bitcoin banks in future and systems of Bitcoin lending?

It could be argued that not having any kind of credit system means that the currency becomes more of a commodity as people invest in it as an asset but it also must be recognised that banking is precisely what has resulted in huge global economic instability and massive economic crises, particularly in Europe and America in recent years.

[hilariousandco]

Hello all,

As a newcomer to Bitcoin who invested a bit a few months ago. I'm interested in how people see the currency changing as it develops. I've read some people who argue that any currency needs a system of credit and banking behind it to be sustainable. Are we going to see the emergence of Bitcoin banks in future and systems of Bitcoin lending?

I'm sure there will be Bitcoin banks in the future, but why people will need them is redundant. I guess some people feel safer letting others look after their money.

[carolynwneal25]

youve gotta be kidding me ..there is bank for bitcoin in 2014??

[hilariousandco]

youve gotta be kidding me ..there is bank for bitcoin in 2014??

Not that I know of.

[hilariousandco]

The whole i idea of bitcoin to remove banks, not to make a big one.

Tell that to the masses.

[banzai]

The whole i idea of bitcoin to remove banks, not to make a big one.

Agree!
Having a Bitcoin bank is like saying banks make money transfer for free,or no interest on credits.

[imamanandyou]

Banks might mean online wallets where you dont own private key - could make sence with password+SMS+yubikey authorization of every transfer - could be safer than local client if your computer is compromised.

[fasteddie9987]

You have online wallets now that act as a holdings service so I imagine these would start charging but you wouldn't be covered for any loses through theft.  You would have a lot of trouble with offering lending and other such banking services as these are heavily regulated.  It all really depends on how bitcoin is viewed by governments and law makers ultimately.

[gutdraw]

The concept of Bitcoin lending is indeed intriguing what about bitcoin bonds? already we have bitcoins prices stocks right?

[sehdal]

I'm certainly pretty sceptical about the development of Bitcoin banks myself. But I just had a quick look online and there is an organisation which appears to call itself the first Bitcoin bank, Flexcoin (a good name for a future currency perhaps):

http://www.flexcoin.com

Still that just seems to make exchanges easier from different devices, in fact I don't really see the point in it at all.

Still if we do have Bitcoin banks emerging, then surely it is only a matter of time before we get Bitcoin banks and lending. This is the whole point of modern banking: looking to make a cheap buck through lending.

[fahayek]

Banks would not destroy the integrity of bitcoin SO LONG as a fractional reserve system is not put in place like the one we have that creates mass credit. Outside of that, banks would be good because it will provide the security consumers would need to adopt it as a currency.

[nerobie]

all really depends on how bitcoin is viewed by governments and law makers ultimately

[BITMIXER.IO]

The problem is bank can't work with bitcoins like with fiat money. In case of bitcoin it can't lend the same money several times (what actually do all banks). That is why bitcoin system do not need a bank service, that is why banks not interested in bitcoin.

[DannyHamilton]

The problem is bank can't work with bitcoins like with fiat money.

Yes, it can.

In case of bitcoin it can't lend the same money several times (what actually do all banks).

Yes, it can.  This is what happens with "fractional reserve" banking.

[cryptoastrotrader]

Bitcoin is antithetical to the banking system. If the banks want to survive into the next decade or so, they will have to temper their greed and embrace Bitcoin in some shape or form, otherwise they stand the chance of being thrown into the dustbin of history.