Are banks needed for crypto?

[imstillthebest]

Is there something similar in crypto? How does it work then? And are such services in demand? Do manufacturers take loans in crypto?

yes crypto has a simillarity on how things work with fiat because cryptos are also a currency .
 its indemand , there are lots of crypto loaning platforms and yes a manufacturer can take loan in crypto to make thier business grow more or if they having a problem in financial .

Fiats have a loan mechanism. Manufacturers use it to improve their production

you mean banks ? because banks are the one that issued the loans but not all loan money for that same purpose  .

[Kakmakr]

The Fiat system is built on "loans" and "Bonds" that are offered by the Banking system to exploit people and to keep them in debt for most of their lives. Crypto currencies on it's own (the technology) does not make provision for these services, because it is not centralized and it is also more geared towards being a currency. 

Some people have created "loan" services on forums like this, where they use reputable escrow services... but it is not very popular, because most people succeed to exploit it.

Bitcoin does not replace "loan" mechanisms like Banks and Shark loans, because it was meant to be an alternative currency. 

[cheezcarls]

In my opinion, I could say that we don’t need banks if a lot of vendor or merchants are accepting cryptocurrencies as the main medium of exchange than fiat. Imagine if a country implementing USDT as their main currency than the traditional fiat for buying goods and services, paying bills, education, transportation, etc., banks would potentially cease to exist. Again this is just my own opinion regarding the scenario.

[Kodok Bencot]

I think banks don't need cryptocurrencies but need blockchain technology to see every transaction in banks, currently there are too many problems in banks, especially transparency from banks so transactions from state officials are never known, so banks are more anonymous than cryptocurrencies.

[avikz]

Just started to learn about DeFi, and a question arose.

Fiats have a loan mechanism. Manufacturers use it to improve their production.

Is there something similar in crypto? How does it work then? And are such services in demand? Do manufacturers take loans in crypto?

Isn't that killing DeFi idea? Is there a future for loan mechanism in crypto?

Thanks everyone in advance for the answers.

The mainstream economy is based on debt. The crypto economy is based on people's network without any third party controlling it. So ideally we don't need banks for a crypto ecosystem. But since crypto is not a mainstream economy, we need an integration layer so that crypto can function with the mainstream economy. That's where we need banks and exchange services.

Defi is a very new type of concept and it doesn't function like banks. In bank, you can get a loan without collateral but that's not possible in defi. I don't see Defi taking over as a mainstream loan mechanism.

[shaqer]

you mean banks ? because banks are the one that issued the loans but not all loan money for that same purpose  .

Yes, but I mean this particular banking option as a way to improve production without considering everything else.

[Vaskiy]

Banks are essential part of a the cryptocurrency network. In one way or the other cryptocurrencies have connection with the fiat. We can go into complete decentralisation or into some form of anonymity. The cryptocurrency network is at its very beginning time period of market widening. So, we can see more new ways and innovative platforms to reach the common people. This will happen to some extent, and beyond that only banks can provide the service to the common people.

[agg2702]

In my opinion, I could say that we don’t need banks if a lot of vendor or merchants are accepting cryptocurrencies as the main medium of exchange than fiat. Imagine if a country implementing USDT as their main currency than the traditional fiat for buying goods and services, paying bills, education, transportation, etc., banks would potentially cease to exist. Again this is just my own opinion regarding the scenario.

this is what makes them incompatible with each other, and when bitcoin becomes legal and becomes one of the legal payments in one country, the bank automatically has a competitor who is arguably better than them.
and consciously or not with bitcoin which is one of the legal means of payment, people have many options, of course most of them will choose bitcoin with banks even though they cannot eliminate the existence of banks and fiat but indirectly and slowly they are eliminated by that matter

[carlfebz2]

Just started to learn about DeFi, and a question arose.

Fiats have a loan mechanism. Manufacturers use it to improve their production.

Is there something similar in crypto? How does it work then? And are such services in demand? Do manufacturers take loans in crypto?

Isn't that killing DeFi idea? Is there a future for loan mechanism in crypto?

Thanks everyone in advance for the answers.

If you are pertaining about loans then there are services out there who do offer such thing but you know that volatility is something that cant really be stopped which means neither you do pay more or less
on the said interest for the loan that you had attained.

Although this isnt talking about institutions or something but rather people who do ran off their own personal money.Banks are irrelevant on this market and thats why crypto
did exist on the first place.

We dont need banks which are heavily centralized it does work for other purpose which we had been using through ages.

[el kaka22]

I opened a thread to discuss the problem not that long ago. What I got from it is that you would likely need some short of intermediary to make it work, call it a bank or a rating agency and certainly a legal system that can enforce contracts outside the blockchain. Crypto in that sense is not that powerful, but the good nes is that you can build a system on top that works as good or perhaps better than current banking systems.

I disagree, that could be done inside blockchain as well and it could be done using third party apps instead of banks. You could do loans, stock markets and many other things in crypto, and you would only need a technological help and not a law related or bank related help. Think of paypal but for crypto, people could all put their money in an app, and they can move money around between accounts without paying transaction fee, that app would be just helping people move money around.

This is how you get rid of banks. However, Banks are so powerful that no matter how strong bitcoin gets or no matter how much it is adopted in our regular world, banks will always stay powerful, bitcoin can't take that power away from them. We are talking about trillions of dollars worth power just in USA and combined makes up for tens of trillions of dollars around the world, bitcoin itself is barely one trillion dollars on a good day.

[Ucy]

Just started to learn about DeFi, and a question arose.

Fiats have a loan mechanism. Manufacturers use it to improve their production.

Is there something similar in crypto? How does it work then? And are such services in demand? Do manufacturers take loans in crypto?

Isn't that killing DeFi idea? Is there a future for loan mechanism in crypto?

Thanks everyone in advance for the answers.

We could have a mechanism that is more suitable for True Cryptos due to their decentralized nature, and we could have a Crypto-friendly ways that ensure that loans are use for good things that will be profitable/useful for society and people.
In my opinion, using loans for autonomous DeFi to fund companies that are dependent on the system may not be a good idea idea. That will be a serious mistake especially if the right things are not put in place first.
I think a True DeFi should be based on economy activities that are independent of the system and are according to Bitcoin/Blockchain ideals if it wants to remain truely decentralized and sustainable

[Sir Legend]

It is time for banks to follow the current trend, the number of users and investors of cryptocurrencies continues to increase so that if they do not use crypto then banks will be left behind and go bankrupt, crypto is a technology that makes all parties benefit and banks must immediately adopt cryptocurrencies.

[GeorgeJohn]

Banks are essential part of a the cryptocurrency network. In one way or the other cryptocurrencies have connection with the fiat.

It's quite understandable that if their is no bank cryptocurrency will not have a nice bond, so bank play more role in cryptocurrency because of it Fiat, it's very obvious that without fiat cryptocurrency especially bitcoin will not have much firms, except it's a situation whereby fiat will be replaced in the name of bitcoin, fiat is an ancient currency which is older than any other currencies seconded by Gold currency, so without fiat collaboration with any other cryptocurrency like bitcoin it will be very difficult before bitcoin will be accepted as a legal tender in some countries, so fiat is another alternative thats excavating the influence of bitcoin currently, that's from my views.

[CryptopreneurBrainboss]

Isn't that killing DeFi idea? Is there a future for loan mechanism in crypto?

Here's how things work over here, you have to have almost double the amount you intend loaning before you can take out a loan as collateral are needed to be able to apply for loan.

That means you basically don't have to need a loan before you'll be eligible for a loan which isn't any different from the real world. Why don't you just sell portion of your asset and clear that problem you need the loan for. The only difference here is that anyone with the money can get access to a loan unlike out there.

For your topic question, Banks are still needed for the moment because we still have to convert our coins to fiats before we can spend them easily but that'll change in the future as more marchant will be accepting cryptocurrency meaning you won't need the flats to be able to transact daily.

[molsewid]

In my opinion, I could say that we don’t need banks if a lot of vendor or merchants are accepting cryptocurrencies as the main medium of exchange than fiat. Imagine if a country implementing USDT as their main currency than the traditional fiat for buying goods and services, paying bills, education, transportation, etc., banks would potentially cease to exist. Again this is just my own opinion regarding the scenario.

This is the only point that every crypto users are waiting for because finally digital assets like bitcoin and ethereum and all crypto tokens can be used to purchase goods and services without interacting with the banks. Today, banks are just needed for transaction of crypto to fiats because crypto is some or many countries today are not yet legally adopted and the only thing that a crypto user can use their crypto to purchase goods and services is to transfer or convert their crypto into fiat through bank process but if merchants would accept crypto then I think banks will soon not in need in crypto.

[Pejoh Asu]

Banks and cryptocurrencies are 2 things that are difficult to put together, maybe like water and oil, the presence of cryptocurrencies is certainly a competitor because people don't need the services of banks to transact, people will find it easy to control finances and transact cheaper and faster than banks.

[Sanugarid]

Banks and cryptocurrencies are 2 things that are difficult to put together, maybe like water and oil, the presence of cryptocurrencies is certainly a competitor because people don't need the services of banks to transact, people will find it easy to control finances and transact cheaper and faster than banks.

Like water and oil, they can still be mixed with the right implements and right ingredients. Maybe we just need to find that metaphorical implements and ingredients to have banks and crypto work together. Yes, we don't need banks but a coexistence could be a better way of handling things.

[justdimin]

We could have a mechanism that is more suitable for True Cryptos due to their decentralized nature, and we could have a Crypto-friendly ways that ensure that loans are use for good things that will be profitable/useful for society and people.
In my opinion, using loans for autonomous DeFi to fund companies that are dependent on the system may not be a good idea idea. That will be a serious mistake especially if the right things are not put in place first.
I think a True DeFi should be based on economy activities that are independent of the system and are according to Bitcoin/Blockchain ideals if it wants to remain truely decentralized and sustainable

The loan mechanism is not mechanism for fiat, it is a mechanism for banks and people are ignoring that part a lot. You do not get loans and it is saved and secure and everyone either pays it back or get sued etc just because it is fiat, it is done because banks have that legal option.

So, let's assume that banks are allowed to give crypto loans, what will happen? They will ask you to come in, sign some papers, show some collateral and then they will give you the loan and you go on with your day, either you pay it back or if you do not then banks will sue you and courts will find you guilty and your stuff will be seized and so forth. Which is why I believe we should be a lot more calm about crypto loans since it can be done with a single law.

[geegaw]

It is time for banks to follow the current trend, the number of users and investors of cryptocurrencies continues to increase so that if they do not use crypto then banks will be left behind and go bankrupt, crypto is a technology that makes all parties benefit and banks must immediately adopt cryptocurrencies.

All banks have stocks and sponsors as well as partners behind them are large domestic enterprises, the biggest businesses in this country happen to have heads who have relationships with politicians, with terror like that, thinking the bank can fall behind and go bankrupt is very wrong, too many bankruptcies have happened before but now, only the strongest warriors survive. Being so politically friendly, the bank understands when they will need to set up with crypto, they have no idea more than simply the politicians behind have not given them the information, the tendency to be too young is very easy to die prematurely

[macson]

Just started to learn about DeFi, and a question arose.

Fiats have a loan mechanism. Manufacturers use it to improve their production.

Is there something similar in crypto? How does it work then? And are such services in demand? Do manufacturers take loans in crypto?

Isn't that killing DeFi idea? Is there a future for loan mechanism in crypto?

Thanks everyone in advance for the answers.

It can be said that the concept of Defi is still very new and the government will definitely not let defi from their attention.  but defi will definitely shift the bank because the borrowing process is easy and simple, not like a bank that is very complicated.