Is it possible to live without banks?

[Abiky]

With the world's economy collapsing, people are looking for alternative safe-haven assets to use in times of turmoil. Interest in crypto has sparked a lot ever since the stock market went on a decline. If people decide to use crypto, precious metals, and physical cash, will it be possible to live a normal life without a bank?

In my case, I'd be willing to exit the banking system in order to have true sovereignty over my money. After all, that's what crypto is all about. If you could live your normal life without the need to ever interact with a bank (having a bank account to make transactions, etc), it'll be a blast. With the world shifting towards the online realm for e-commerce, virtual meetings, and more, it seems likely that people will be using decentralized money more thoroughly. There are still people using credit/debit cards, but that may change soon as Fiat becomes hyper-inflated.

What are your thoughts?

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[LeGaulois]

If you don't receive your salary paid in bitcoins and if you can't use your salary everywhere you will still need to use a bank.

Otherwise how do you plan to receive your monthly cheque or how do you plan to pay the recurring payments to pay the bills (water, electricity, ISP, phone, insurances, taxes, landlord...)? If you can not pay the groceries how will you pay the cashiers?

How businesses could be created if they can't borrow money from the banks? It's what makes an economy growing, create jobs, etc
What about the average Joe using his interest account to earn a small profit annually? He won't have any opportunity. The amount collected with the interest accounts from banks is also used on the local economy, to build houses for the average class for example.
The average Joe won't be able to borrow money to buy a car to find a job, or to build his own house.

Bitcoin isn't looking to replace the banks but rather to be an alternative, as a second layer (or as the first, as you wish)

[Upgrade00]

If people decide to use crypto, precious metals, and physical cash, will it be possible to live a normal life without a bank?

Banks produce physical cash and hence if it's still in use banks would still be relevant, and everyone can't withdraw all the cash they own and keep in their pockets. Cryptocurrencies are not yet mainstream enough to be used as a global currency. Previous metals can be used as assets, but cannot be used for day to day transactions and it would make nations without natural resources heavily dependent on other nations

In my case, I'd be willing to exit the banking system in order to have true sovereignty over my money. After all, that's what crypto is all about.

It's not the most ideal situation, but majority of people do not want to be burdened with the task if being their own bank and being wholly responsible for the funds they own.

[gentlemand]

There are still people using credit/debit cards, but that may change soon as Fiat becomes hyper-inflated.

As long as you live in a country you will be taxed. That tax will be charged in fiat. It would be great if you pay it in crypto, and maybe third parties will pop up, but I can't see governments letting that go.

And also in many areas more than 50% of the population is dependent on government money, either public sector jobs or welfare of some sort. That money is always going to be paid out in fiat.

I could easily switch to pure crypto right now. I don't have any loans, overdrafts or direct debits of any note, nor am I paid into a bank account. All I'd need is places accepting it. But I would not leave behind a proper bank account and switch to a crypto debit card for the moments I needed that. None of them are competent or dependable enough.

[Ucy]

Will work pretty well for decentralized crypto with proper governance . not so sure about using physical precious metals without easily accessible ledger and accounts/addresses in a world that is used to fast and complex economic system.
Decentralized Crypto can comfortably replace the typical bank once things become easier and safer for new users. 

And I think we could use cryptocoins in physical form (like physical fiat) if we want to

[Twinkledoe]

Actually it is possible to live without banks. There are many people who are living in remote or rural areas that don't own any bank account. Also, those people that are working in most blue collar jobs, who are paid daily or weekly that don't need bank accounts as they are being paid in cash. A lot of people in third world countries don't own any bank account up until now. So my answer is yes, it is still possible to live without banks.

[dothebeats]

It is possible to live without banks. But fiat? I don't think so.

Say your employer decides to pay you in bitcoin. Even if it's in the form of cryptocurrency, they have their records of payrolls in order to keep track of how much whom gets. It's good if the government is willing to accept bitcoin as tax, but until then that bitcoin is going to be converted to fiat in order to fulfill your 'civic' duty for the country. Also, buying your necessities would be a hard thing to do since you can't just go out into Walmart and whip your phone, expecting to see a QR code designated for bitcoin payments. Well perhaps if the idea of bitcoin is truly accepted, then perhaps you can do that.

[FlightyPouch]

I think as far as fiat is there, banks will be inevitable. You might not need it but there would be a lot of people that will do. Even though there is this freedom that crypto currency offers, there are those that will still use banks for something. It might be because of the small and boring interest, maybe for other things but there are some people that are actually living without using these banks, though they are having a hard time getting fiat for themselves too.

[Baofeng]

With the world's economy collapsing, people are looking for alternative safe-haven assets to use in times of turmoil. Interest in crypto has sparked a lot ever since the stock market went on a decline. If people decide to use crypto, precious metals, and physical cash, will it be possible to live a normal life without a bank?

I doubt though, majority is still dependent with banking system per se.

In my case, I'd be willing to exit the banking system in order to have true sovereignty over my money. After all, that's what crypto is all about. If you could live your normal life without the need to ever interact with a bank (having a bank account to make transactions, etc), it'll be a blast. With the world shifting towards the online realm for e-commerce, virtual meetings, and more, it seems likely that people will be using decentralized money more thoroughly. There are still people using credit/debit cards, but that may change soon as Fiat becomes hyper-inflated.

What are your thoughts?

Of course everyone has this thought of exiting the banking system to be fully independent of them. However, as of today, it can't be done, we are still need them for support, like you said, credit/debit card remains as the most used mode of payment today, and not cryptos. So it will be difficult to just abandon the banking system right now.

[leite]

Yes, it's really possible if we incentive the exchange crypto to goods, food and all kind of service that money is used. In the distant past they used gold, silver and precious metals in these exchanges, now everything is digital with us.

This movement is happening just for early adopters with persistency.

We have to do more, more and more simple softwares to mass adoption.

[Gyfts]

I mean, you could live without banks, but having absolutely no regulation over someone's funds essentially means there is no purpose of government. The federalism system was partly created because of taxation reasons. A centralized authority needed to maintain consistent currencies between states and have the authority to collect taxes among all residents. The federal reserve is, at least by part, a bank and I'd argue there'd be no way to run a country without some centralized bank.

Hypothetically if Bitcoin were the sole economic currency, how would tax collection work?

[d5000]

I have started a poll just a couple of days ago about this exact topic: Anybody here trying to live bankless (using Bitcoin / cryptocurrencies)?

Response has bit a bit underwhelming, but there were at least three or four participants who lived "bankless" at least for some time, some of them (I think) from lesser developed countries. Tax payments and general service payments have been mentioned as obstacles, to a lesser extent also volatility.

In my country, I can pay some of my taxes in cash or with a digital wallet managed by a financial company which is not a bank (something like a "local PayPal"), but e.g. for the tax for small businesses a payment via bank transfer or debit card is mandatory, because the government wants to discourage payments in cash (although no "cash abolition" is planned).

Otherwise how do you plan to receive your monthly cheque or how do you plan to pay the recurring payments to pay the bills (water, electricity, ISP, phone, insurances, taxes, landlord...)? If you can not pay the groceries how will you pay the cashiers?

This depends heavily on the country you live. In my country I can pay almost all services with cryptocurrencies, but only via a third party payment processor company (which again, are not banks but also regulated and mostly have KYC/AML procedures).

How businesses could be created if they can't borrow money from the banks? It's what makes an economy growing, create jobs, etc

In theory this can be covered by Bitcoin P2P lending, or even by "Bitcoin banks". The main problem here is, however, volatility. If you borrow 1 BTC and just there is a Bitcoin rally, you'll have problems to pay it back. Thus, at this moment, the P2P lending market is not very developed (it exists mostly to provide capital to short sellers) and is not adequate for the "average Joe".

Volatility is also a problem if you got your salary in BTC and don't want it to lose value if there is a crash. (For the volatility problem I'm reseaching for a solution "without" centralized providers, see here).

What about the average Joe using his interest account to earn a small profit annually?

Also here ... Joe would have to lend Bitcoins to someone and he would get paid interest for that. But the volatility-related risks are still to high for "average Joes".

Bitcoin isn't looking to replace the banks but rather to be an alternative, as a second layer (or as the first, as you wish)

I agree partially - banks will continue to exist even if Bitcoin was perfectly stable and had replaced fiat totally. They'll still have advantages managing risks, as they have the best algorithms for risk management (BlackRock's Aladdin, for example) and lots of connections to the local economy (or to the "blue chip companies" in the case of bigger banks). But it's possible that some typical banking services, like a savings account, could be "taken over" by cryptocurrencies.

[Omair Amin]

In current situation a lot of people are willing to adopt the digital assists instead of banking system in most cases it quite volunarable most of the people are beware how to live life without banking system in the same time the government should provide the suitable mechansim hence they would also integrate the  digital assists instead of banking system i think in future a lot of people moving towards the digital terminologies to used the crypto assists instead of banking system to live their life.

[Darker45]

Without any kind of bank? Not just the current form of bank that we all know? I really doubt it.

Rudimentary forms of banks could be traced back thousands and thousands of years ago. This early, even before the peak of the crypto age, we already have what are called crypto banks. So I don't think the banks will perish soon with the advent of crypto. It could transform, though, as it always has been. With our virtual currencies, we could very well see virtual banks as well.

For now, I cannot live without banks. I cannot even live with crypto alone.

[TravelMug]

For now, I cannot live without banks. I cannot even live with crypto alone.

^^ This. As much as we wanted to live without banks, At the current situation it is really hard specially in countries where people are relying on bank for their everyday lives. There are still a lot of people who really believes that it is far safe to keep your money there, and I do believed that this is still case as we all know that banks have been part of our lives for centuries know and I would say have "brainwash" generations after generations already. So it will be very difficult for them to adjust and simply adapt crypto in their lives. The question is, why not take advantage of both systems?

[Wexnident]

By destroying the nature of the bank, the system of fiat would probably collapse, or at least, be reduced to what is seemingly a useful but useless asset. The first thing that cropped out of my mind when banks were said to be gone would have been the era of the past, trading items for items instead of using cash. After all, the government regulates the supply of fiat cash BUT the central banks are the one responsible for producing the fiat. Sure, you could ask someone else to create it, but the process required to create it is also connected to banks purchasing assets or lending money to other institutions. There's also an issue of Central Banks being the one most involved in regulating the inflation of the market and growth of the economy

Yes, it's really possible if we incentive the exchange crypto to goods, food and all kind of service that money is used. In the distant past they used gold, silver and precious metals in these exchanges, now everything is digital with us.

This movement is happening just for early adopters with persistency.

We have to do more, more and more simple softwares to mass adoption.

In the past.What do you think why the words "past" were used? It was because something better came up, which was the fiat system, so using it as an argument to defeat the one that changed it seems kind of weird imo.

[reality18]

The system has been designed in a way that Banks still contribute and remain significant in our societies. Bills, school fees (basic and high schools and universities) are paid through the banks. Since it has got the full backing of the governments, it is very difficult to live without until cryptocurrency is able to accomplish the payment systems for the above.

[Latviand]

I mean, you could live without banks, but having absolutely no regulation over someone's funds essentially means there is no purpose of government. The federalism system was partly created because of taxation reasons. A centralized authority needed to maintain consistent currencies between states and have the authority to collect taxes among all residents.

Yes, we could live without banks, and it is really hard for us, citizens of the community. The governments are the regulator of the money in a certain country, especially money of the people and the taxes. If there is no banks, there's no taxes that the government can collect and it will become not that effective and we will not have enough budget for the expenses and growth of our country and economy.

The federal reserve is, at least by part, a bank and I'd argue there'd be no way to run a country without some centralized bank.

Centralized bank are essential especially that we need the authority to regulate our money and produce fiat or paper money so that we can use cash in many transactions. Digital money is not that guaranteed to use in most of our payments because sometimes not all of us have an access to internet especially those indigenous people. It is still effective if we use paper money that's provided by our banks and spread it all over the country so that we have a tangible thing to use.

[Sanitough]

The main purpose of the bank is just to print money, and monitor the banking system that they have given the license, I am talking about the Central bank.

While with bitcoin, I think bank is not need anymore because the goal of bitcoin is to do banking without bank, which is possible since we already have the supply being created and we can transact using the blockchain which is a decentralized system. Now,  what we only need is the government to support crypto so they can give license or legalize the payment processor that would help bitcoin transaction to be faster and cheaper, and by saying this, it means we will stop using fiat and bank will stop printing money too.

[TheUltraElite]

First thing, world economy wont collapse. I have see the housing crisis and several more "recessions", but the system never breaks because of certain things that are kept in place, which is better not to be thought of by common people.

Secondly, the purpose of a bank and a payment system are different. Banks are needed for loans mainly being the biggest asset being debt. So you need money in emergency you need a bank that you can trust. Does bitcoin allow you the same thing? Essentially it should, but practically you need a lender who you can trust with a collateral to get a loan.

Similarly do people give you deposit schemes to get 5% interest rate? Essentially some projects like Celsisus had done this, but can you trust then with money? No.

Thing is, there will always be banks even if people think they have turned the tables, they really have given away the table to the financial institutions because they are blind in their approach to how the world works. Refute me if you think the opinion is unpopular but the truth always hurts and so people overlook it.