Why are banks against cryptocurrency?

[khalidkhan82118]

Banks tend to view cryptocurrency with caution for a few key reasons:

Loss of Control: Cryptocurrencies are decentralized, meaning they aren't controlled by any one entity like a central bank. This disrupts the traditional banking system, where banks act as intermediaries in transactions.

Volatility: Cryptocurrencies are known for wild price swings, making them a risky investment for banks that value stability.

Regulation: The regulatory landscape surrounding cryptocurrency is still evolving. Banks are wary of getting involved in an area with unclear rules.

Money Laundering and Crime:  Some fear cryptocurrencies can be used for illegal activities due to their anonymity. Banks have strict anti-money laundering (AML) protocols and may hesitate to deal with anything that could raise red flags.

In short, cryptocurrencies challenge the traditional banking model and introduce a layer of uncertainty that banks are generally cautious about.

[Ojinga]

So what I'm ultimately getting out here, is that crypto currency can't go in line with banks. What are your thoughts towards this?

I think that only those cryptocurrency that are created by central banks and the regulator can go in line with banks. That is, CBDC and those cryptocurrency that they can control (emission, block and freeze accounts, track any transactions).

(0) BANKS ARE AGAINST CRYPTOCURRENCY BECAUSE THEY CAN'T MAKE MONEY FROM IT. Why should a bank, as a commercial organization (a business that makes money from money), be loyal to cryptocurrency, because of which they lose their commissions on transactions?

what makes you think banks can't make money from it? The banks are not the major problem here but the actual problem are the government. If crypto currency and central banks goes in line of agreement to have commission with each other's. They'll definitely benefit from the Bitcoin Just that the government haven't approved it yet, just as I said earlier they're scared of fraud and scams. Because the crypto currency it's a digital system which operates with regulative landscape. So some fear cryptocurrency can be used for illegal activities due to their anonymity, banks have strict anti- money laundering (AML) protocols and may hesitate deal with anything could raise red flags.

[PrivacyG]

(3) CRYPTOCURRENCY RISKS FOR BANKS?  Risk of fraud and scams among crypto-asset sector participants.

Scams and Fraud that could of been prevented for the most part anyway.  But they rather not do anything so they can have what to blame.

I expect a very significant percentage of the Cryptocurrency Scams happened on ex Twitter or You Tube.  These two are supposedly moderated.  They have automated bots too, working continuously to look for posts or accounts to ban or remove.  They did absolutely nothing for MANY MANY years about it.

Other than these.  I doubt there would be many Scams around.  People are getting Scammed for Dollars too, but no average person says the Dollar is bad.  They all like it.

[peter0425]

Banks will traditionally be against anything that has the potential to affect their business. Traditional banks have been against even fintechs because they reduced their customer base, cryptocurrency has the ability to also affect the customer base of these banks that is why they are against it.

They hate it but in reality they also benefit from fintech. How?

They steal the ideas and concepts related to fintech. They have started adjusting their services to keep up with fintech and it has only made theirs and our lives better. Soon enough they might also start using blockchain mechanisms. They are definitely looking for ways to improve on their methods so as not to lose customers.

[avp2306]

(3) CRYPTOCURRENCY RISKS FOR BANKS?  Risk of fraud and scams among crypto-asset sector participants.

Scams and Fraud that could of been prevented for the most part anyway.  But they rather not do anything so they can have what to blame.

I expect a very significant percentage of the Cryptocurrency Scams happened on ex Twitter or You Tube.  These two are supposedly moderated.  They have automated bots too, working continuously to look for posts or accounts to ban or remove.  They did absolutely nothing for MANY MANY years about it.

Other than these.  I doubt there would be many Scams around.  People are getting Scammed for Dollars too, but no average person says the Dollar is bad.  They all like it.

It could be prevented  if their institution together with government entities decide to regulate it and for sure those scams will be minimize especially if there's certain actions made like asking a KYC on any crypto platforms that operate on the country of their concerns. But they insist to do that since there's business interest they are protecting and maybe cryptocurrency is against on their possible plan of digitalization that's why they are trying to ignore it and make people discourage to use crypto.

Lots of scams are already happening on that platform that's why we need to avoid taking any offers and possible remind people around us that its not good idea to try those offers they see online so that there will be no huge issue of scamming thay might possible to happen.

People got scam in dollars to but they are already washed on the idea that they can easily move on in that situation and they blame those criminals who do it, but there are biased opinion when it come to crypto since they automatically associate that crypto is scam when they got scam by individual scammers and this mindset really need to be corrected and all people should now that crypto is just the same with fiat which a currency that they can use and scams made by people is separate on this.

[Finestream]

I don’t think banks are the ones against Bitcoin. It should be the government that is against Bitcoin because they don’t have control over it. The banks actually report to the government and because Bitcoin isn’t doing the same, they don’t like it. Because starting from tax and other things they’d have implemented or rule they’d have set, they can’t. Bitcoin takes out the middle man and the government can’t do nothing about it, no matter much they dislike it.

Precisely. Banks are completely controlled by the government, and whatever banks did, the government orders it. So it’s clear that it’s actually the government that is hitting against bitcoin, but knowing banks represent the government, so most probably this competition between banks and bitcoin arise.

Now, as long as bitcoin remains decentralized, it will never be supported by the banks and the government. But maybe in the future, who knows, we can see banks and bitcoin work hand in hand. It’s really not impossible once the government becomes open minded about bitcoin and how it brings convenience and advantages to the people.

[Zoomic]

Banks will traditionally be against anything that has the potential to affect their business. Traditional banks have been against even fintechs because they reduced their customer base, cryptocurrency has the ability to also affect the customer base of these banks that is why they are against it.

They hate it but in reality they also benefit from fintech. How?

They steal the ideas and concepts related to fintech. They have started adjusting their services to keep up with fintech and it has only made theirs and our lives better. Soon enough they might also start using blockchain mechanisms. They are definitely looking for ways to improve on their methods so as not to lose customers.

Who wouldn't want a decentralized system that gives you the opportunity to be your own bank? People are fast realising that they have been cheated by the banks for years,  hence the rapid movement from the banks to a better alternative (crypto) that offers what the banks cannot give. Why wouldn't the banks hate this new invention that has exposed most of their secrets to the common man.

People are wiser now, it is better they adopt Bitcoin, a decentralized system with a currency that appreciates over time and with good security,  than stick to the banks that steals from them with the disguise of helping them keep their valuables safe.

Banks will hate, but it will not stop the mass adoption of bitcoin.

[Iranus]

(3) CRYPTOCURRENCY RISKS FOR BANKS?  Risk of fraud and scams among crypto-asset sector participants.

Scams and Fraud that could of been prevented for the most part anyway.  But they rather not do anything so they can have what to blame.

Many investors demand privacy and don't want to pay taxes, which means we don't want the government or anyone else to invade our privacy, but we ask the government to intervene if we get scammed. Are we too greedy?

I expect a very significant percentage of the Cryptocurrency Scams happened on ex Twitter or You Tube.  These two are supposedly moderated.  They have automated bots too, working continuously to look for posts or accounts to ban or remove.  They did absolutely nothing for MANY MANY years about it.

Other than these.  I doubt there would be many Scams around.  People are getting Scammed for Dollars too, but no average person says the Dollar is bad.  They all like it.

All social networks are created to bring the best experience to users, but there are some users who are using it for their own bad purposes, making management quite difficult. You can't blame those social platforms if you get scammed, whereas if you weren't greedy you wouldn't have fallen into those scam traps. Similarly, many scams altcoin projects and many person-to-person scams also appear on this forum, why don't you blame the forum, what are you afraid of? It's all human behavior, don't try to blame social networks when you are a victim of scams.

[Filippo Spina]

https://www.youtube.com/watch?v=L45zymFDltM

They hate us because they are not like us.

[passwordnow]

(1) SO WHY BANKS ARE REALLY AGAINST CRYPTOCURRENCY? Cause the volatility of cryptocurrency markets are concerns over security and regulations. They've made many banks cautious about involvement in the crypto space. Some banks have even banned the use of cridit cards for purchasing cryptocurrency, reflecting their hesistancy to embrace the emerging technology full. If only the cryptocurrency are ready to make a good terms with the banks.

There are also banks that won't allow you to go on with your account with them if you ever tell them that your source of funds is crypto. And that's why some stories have been told that they were stopped by the bank to proceed banking with them just because of it. I don't know about the concerns about security but even the banks have a lot of security issues. Or let's just say that they're the same if the user is the one that's negligent with how they login or access their banking accounts and the same goes with the crypto users that are accessing their wallets through unknown links and possible phishing links and forms.

WHY IS CRYPTO NOT ACCEPTED IN BANKS? The main reason banks do not accepted Bitcoins as legal tender, is because they aren't backed by a central authority. Such as a government or central bank, unlike traditional currencies, Bitcoin is not regulated or guaranteed by any third party. And this will also make the banks to get scared of linking up with crypto currency.

And banks are for the legal tender of the country that they're in. That's why I think even that a country starts to adopt BTC as their legal tender, there will be a separate division of the bank that will allow BTC deposits. But even with that, let's analyze it about accepting it as their deposits when we can have our own wallet and be our own bank as what the famous quote about our wallets. So, it doesn't really have make sense anymore if the banks are going to accept BTC as deposits, it will make sense I guess if they accept it as a loan collateral.

[Peanutswar]

The bitcoin was built for a reason satoshi want to become decentralized and give an option to the people if they want to get regulated with their money or not. Banks regulate your money even you called this as your money its not because you don't have full control of it, once you make a deposit its already their money that has a limit with the withdrawals that you cant get all of your money instantly and takes a lot of process and documentations but in bitcoin you can freely use your money anywhere and anytime you want. Banks don't usually store your money only instead they are using your money to lend to other people with interest and still you have your money with just a small APY.

[jrrsparkles]

Banks don't care about the volatility nature as you say and all they are concerned is decentralization which means people won't need banks anymore if everyone starts using crypto for their payments you need to realize bank is a profit-making organization, not a charitable organization so it's obvious that they don't want the competition to exists and since banks and government are incorporated they got the powers that needed to take actions to crumble the activities of crypto as much as possible.

[Ojinga]

(3) CRYPTOCURRENCY RISKS FOR BANKS?  Risk of fraud and scams among crypto-asset sector participants.

Scams and Fraud that could of been prevented for the most part anyway.  But they rather not do anything so they can have what to blame.

Many investors demand privacy and don't want to pay taxes, which means we don't want the government or anyone else to invade our privacy, but we ask the government to intervene if we get scammed. Are we too greedy?

I expect a very significant percentage of the Cryptocurrency Scams happened on ex Twitter or You Tube.  These two are supposedly moderated.  They have automated bots too, working continuously to look for posts or accounts to ban or remove.  They did absolutely nothing for MANY MANY years about it.

Other than these.  I doubt there would be many Scams around.  People are getting Scammed for Dollars too, but no average person says the Dollar is bad.  They all like it.

All social networks are created to bring the best experience to users, but there are some users who are using it for their own bad purposes, making management quite difficult. You can't blame those social platforms if you get scammed, whereas if you weren't greedy you wouldn't have fallen into those scam traps. Similarly, many scams altcoin projects and many person-to-person scams also appear on this forum, why don't you blame the forum, what are you afraid of? It's all human behavior, don't try to blame social networks when you are a victim of scams.

we all know their are scammers all over social media, not only here on forum but also in other networks. So what I'm saying is that the Banks aren't ready yet to align with crypto currency, why? Because the government have to approve over it before they can make any decisions, if supposedly they align with the Bitcoin they'll surely benefit from them. Because right now when it comes to markets the Bitcoin prices and rates are more reliable then other platforms, for me the banks are not afraid of the scammers or being fraud but they're only waiting for the government to make a volatility and the government are afraid cause if the crypto currency takes over they might lose more percent then now.

[Cryptomultiplier]

I don’t think banks are the ones against Bitcoin. It should be the government that is against Bitcoin because they don’t have control over it. The banks actually report to the government and because Bitcoin isn’t doing the same, they don’t like it. Because starting from tax and other things they’d have implemented or rule they’d have set, they can’t. Bitcoin takes out the middle man and the government can’t do nothing about it, no matter much they dislike it.

Like you read my mind on this, because clearly, the banks report to the government and the government through the asset and security agencies try to regulate the affairs of cryptocurrency all in a bid to control it just like the central banks of a country.
Seeing that the only way to control cryptocurrency and Bitcoin is by taxing hodlers and investors, the tussle now is who gets to dominate the society and become number one option for payments and transaction for the citizens.
It would be hard to gain full control of BTC or cryptocurrency because of its decentralized and P2p nature, and the only way banks will be able to survive along side the massive adoption and use of cryptocurrency, is to accept it so as they could find cryptocurrency accounts/wallets and receive as much as allow taxes of citizens to be paid with crypto currency, just like Brazil, Lugano, Britain and El Salvador are doing currently.

[Nrcewker]

As said before, the main reason for the banks to hate Bitcoins is the decentralised nature of the coin. Due to the decentralised nature of the coin, the government neither the bank can keep a track of the transactions that is made for crypto. Due to this decentralised nature of the coin, the government is unable to impose tax on it, for which they are making Bitcoins illegal. Now the banks follow the government, hence if the government is not supporting the coin, then how can banks will do it. So if the Bitcoins are not legal in your country, then definitely banks will also not support you on Bitcoins or crypto transactions.

[oktana]

I don’t think banks are the ones against Bitcoin. It should be the government that is against Bitcoin because they don’t have control over it. The banks actually report to the government and because Bitcoin isn’t doing the same, they don’t like it. Because starting from tax and other things they’d have implemented or rule they’d have set, they can’t. Bitcoin takes out the middle man and the government can’t do nothing about it, no matter much they dislike it.

Both banks and governments are against bitcoin,the bank is government,the government works with the bank as well.Therefore,prohibiting bitcoin from operating freely is highly a setback to bitcoin.The government would always want to promote whatever they're In charge of,so if it doesn't work to thier expectations and how they should operate then it becomes a problem to them.
Bitcoin is not backed by government,bitcoin only operates as a peer 2 peer network system,thereby fixing the issues that fait seems difficult to handle.
The transformation that bitcoins adoption has created has laid traces and lasting changes in financial technology.

I don’t think that the bank is the government. The bank is an institution on its own. The government is also unique on its own. What I know is that the government (with their power) can tell the bank what to do (give them information or track some money or someone). But they are different entities.

[Ale88]

(6) HOW DOES CRYPTOCURRENCY AFFECT THE BANKS?  In my own opinion, cryptocurrency have had a profound impact on traditional banking. By challenging the status quo and disrupting long-est abolish systems, their decentralized nature, cost advantages, and increased accessibility have implications for both individuals and financial institutions.

Ask yourself as a business man will you happy when new competition comes up?

Banks will traditionally be against anything that has the potential to affect their business. Traditional banks have been against even fintechs because they reduced their customer base, cryptocurrency has the ability to also affect the customer base of these banks that is why they are against it.

It's always been like that, and I'm not saying that to defend the banks (I would never do that) but of course people and/or businesses don't like being replaced. At the same time the good news is that is not possible to stop the future so the banks have two ways: adapt and evolve embracing the cryptos, and making money out of it, or keep fighting a war they can't win. We'll see who is smart and who is not.

[Churchillvv]

The main reason banks do not accepted Bitcoins as legal tender, is because they aren't backed by a central authority.

The main reason is because the legislation doesn't allow it. Otherwise in a country like El Salvador where it is counted as legal tender the banks accept it as legal tender as well and bitcoin is not backed by any central authority be it in El Salvador or elsewhere!

For clarity purposes, I will love to ask you some questions as I'm willing to learn from you.

Bitcoin is accepted as a legal tender in El Salvador, and the people who accepted it as legal tender in that country are they not the government? If yes! Is the government not a centralised body or authority?

So How then is bitcoin not backed by a centralised authority in El Salvador? Just wanna know. I'm curious

[martinex]

https://www.youtube.com/watch?v=L45zymFDltM

They hate us because they are not like us.

No, if there really is I think it's just visual to influence others to follow them. To add to the truth of their argument, of course, it needs support in many people / masses who participate, if there is no yes it will be a normal spectacle or let's just say an advertisement is running on a television channel.

What feels this investment journey and the gains and losses is that we ourselves are not someone else, so blaming is also not good. .

[Die_empty]

So what I'm ultimately getting out here, is that crypto currency can't go in line with banks. What are your thoughts towards this?

I think that only those cryptocurrency that are created by central banks and the regulator can go in line with banks. That is, CBDC and those cryptocurrency that they can control (emission, block and freeze accounts, track any transactions).

(0) BANKS ARE AGAINST CRYPTOCURRENCY BECAUSE THEY CAN'T MAKE MONEY FROM IT. Why should a bank, as a commercial organization (a business that makes money from money), be loyal to cryptocurrency, because of which they lose their commissions on transactions?

what makes you think banks can't make money from it? The banks are not the major problem here but the actual problem are the government. If crypto currency and central banks goes in line of agreement to have commission with each other's. They'll definitely benefit from the Bitcoin Just that the government haven't approved it yet, just as I said earlier they're scared of fraud and scams. Because the crypto currency it's a digital system which operates with regulative landscape. So some fear cryptocurrency can be used for illegal activities due to their anonymity, banks have strict anti- money laundering (AML) protocols and may hesitate deal with anything could raise red flags.

Banks will profit from cryptocurrencies through service charges on transactions. Some banks might also make money from hodling Bitcoin and other renowned coins. But this does not erase that they can also experience losses dealing with it because of the high risk associated with the sector. Customers dealing on crypto true centralized platforms like banks would have to undergo strict KYC, so the banks wouldn't be scared of scams or money laundering because it can easily be identified or traced.

The reason why banks don't deal with crypto is because the government has not approved it. Some countries have not been able to enact comprehensive regulatory laws that will bring the sector under the control of the government, so they are playing safe by restricting banks from joining the sector. The US ensured that they had a robust law to monitor and control the ETF before it was approved. Maybe in the future, more countries will be more friendly to Bitcoin after they have put control mechanisms in place.