My money in bank backed or not real ?

[FatFork]

And have you ever witnessed cash shortages and services refusing to accept payments using bank accounts in your country or anywhere? I believe that has never happened and I have never encountered that in my country.

Actually, I have. This happened many times in the past (and still happens) in countries with unstable economies or during the transition of political systems. For example, during the financial crisis in Greece, many banks imposed strict limits on withdrawals and transfers.

You are probably among the lucky ones who live in a country with a stable economy and a well-functioning banking system. But unfortunately, many people don't.

[WillyAp]

So If i have money in bank is like i have crypto in my wallet? If i see i have 3000 usdt balance i can take it out send it exchange so i know that its there and real.

What is real for you?
For me, a medium which can get me stuff (food, electricity, water etc.) is real.

[kryptqnick]

When you have crypto in your wallet, that's one story. If it's a noncustodial wallet, the coins are truly there, truly available. You might lose some value because the prices can change, but your balance in the currency you own is true.
In case of banks, I'm pretty sure they don't have enough money to cover all the "balance" of their customers. That's why banks go bankrupt if people suddenly withdraw tons of money from their accounts. So there's always a risk here that the money is just numbers and you can't actually get it all (normally you can, but if too many people do it at once, it becomes impossible).

[Ozymon]

Theoretically, money or currency that were issued by the Government should be back by precious metal reserved like gold and silver, but nowadays, but currently the gold standard isn't used by any country at all, the first country which abandoned the gold standard is USA in 1933 and the last country which abandoned it is Switzerland in 1999.

Nowadays, our money is only backed by Central Bank and Government by making regulations and laws. So, realistically the money in our balance is merely just digital number which isn't backed by anything but laws.

[Nothingtodo]

So If i have money in bank is like i have crypto in my wallet? If i see i have 3000 usdt balance i can take it out send it exchange so i know that its there and real.

Saving money in the bank means security in the future, but if the interest rate of the bank is not high, then saving money in the bank will not bring much benefit. But in other countries, if you keep money in the bank, you definitely get more profit and if you keep the money in the bank, the security of that money is much higher. But in my Bangladesh, if money is kept in the bank, the money is embezzled and the people's money is smuggled and the bank goes bankrupt, as a result, the people's trust in the bank has been lost.

[glendall]

So If i have money in bank is like i have crypto in my wallet? If i see i have 3000 usdt balance i can take it out send it exchange so i know that its there and real.

Saving money in the bank doesn't actually provide many benefits, there is an excessive admin burden, currently it is better to save in BTC, in a few months it can provide benefits

[wahyuagung26]

Money in your bank is just a digital balance of what they owe you. You can never be 100% certain that you won’t get your accounts closed or some kind of worldwide depression causes banks to enforce max withdrawal limits per month or something. Be your own bank, save in Bitcoin.

 Agreed, we think Bitcoin is an alternative as your own storage bank, far from digital banks that continue to display the amount of your money, but different in value changes where the money you save will still have the same value while saving in Bitcoin you can monitor the fluctuating movements that occur in Bitcoin.

[DrBeer]

So If i have money in bank is like i have crypto in my wallet? If i see i have 3000 usdt balance i can take it out send it exchange so i know that its there and real.
But in bank my balance might 3000 but bank only got real money the cash or some virtual digits or units 1500.
If they got no equal amount what i actually hold then it's scam.
By BASEL 3 New rules capital requirement it's end of scam you can't just show on the balance sheet what you actually don't have.
By basel 3 rules small banks goes to bust.
So in this case there is a lot questions to ask what is the money and how secure is the system of recording our money.
And even some random peace of stone are more as real money currency then money we think we have in the bank.


That's why If we talking about "having the money" only if it's cash or crypto stablecoins.

Off course even some crypto exchangers show balance what they actually don't have but crypto exchangers not so scammy like Banks the Banks i remember fanny mae and other ones lent out mortgage deals what they did not have ownership and people in USA just lost homes.

The banking system, is a system that does not deal with REAL assets. Moreover, banks don't actually work with their own money.  They take YOUR money. And a lot of other people's money. And they give these assets away to other people, in the form of CREDITS. So the bank has NO real money. But your card account, unlike the blockchain, just has numbers that the bank's accounting system has drawn to you, and these are SYNTHETIC numbers that have no real, physical confirmation. In blockchain you see the REAL picture !

[avikz]

So If i have money in bank is like i have crypto in my wallet? If i see i have 3000 usdt balance i can take it out send it exchange so i know that its there and real.
But in bank my balance might 3000 but bank only got real money the cash or some virtual digits or units 1500.
If they got no equal amount what i actually hold then it's scam.
By BASEL 3 New rules capital requirement it's end of scam you can't just show on the balance sheet what you actually don't have.
By basel 3 rules small banks goes to bust.
So in this case there is a lot questions to ask what is the money and how secure is the system of recording our money.
And even some random peace of stone are more as real money currency then money we think we have in the bank.


That's why If we talking about "having the money" only if it's cash or crypto stablecoins.

Off course even some crypto exchangers show balance what they actually don't have but crypto exchangers not so scammy like Banks the Banks i remember fanny mae and other ones lent out mortgage deals what they did not have ownership and people in USA just lost homes.

I can confirm that no banks in the world holds 100% of their deposits in their coffers. This is not how the banking system works. usually banks lend around 70%-90% of their deposits and keep somewhere between 10% - 30% in cash or cash equivalent. That's why the economy is based on debt. Unless the bank loans out money, how would they generate income?

If all account holders of a bank tries to withdraw 100% of their money at any given point of time, the bank will collapse because they don't have it. This statement applies to every single banks in the world.

Stablecoins are even more dangerous! Your fiat is backed by the central bank of the country. Stablecoins are backed by a promissory note which is again backed by the central bank of the country. Economy depends on money circulation. There's no point in keeping the money idle because then the growth will be stalled.

[Dr.Bitcoin_Strange]

Well, despite the drawbacks of bank, in my opinion bank is not completely useless. We might have huge amount in our bank account which will just be showing in a digital figure and if you want to move the money to somewhere else, you can still do that, after all its still your money but you can not just have all that money in cash depending on the volume. We know that it's only when you hold your money in your hand that's when you are rightfully in possession of it but if it is in the control of a third party like exchange or bank, they decide what happens to the money or not if anything goes wrong.

[DrBeer]

Well, despite the drawbacks of bank, in my opinion bank is not completely useless. We might have huge amount in our bank account which will just be showing in a digital figure and if you want to move the money to somewhere else, you can still do that, after all its still your money but you can not just have all that money in cash depending on the volume. We know that it's only when you hold your money in your hand that's when you are rightfully in possession of it but if it is in the control of a third party like exchange or bank, they decide what happens to the money or not if anything goes wrong.

The size of the bank's reserves is calculated so that NONE of the customers can do such actions. But the total amount of daily transactions - outside the bank (other banks, trading networks with accounts in other banks, etc.) is calculated and provides such transactions. But try for example to initiate a withdrawal of more than 25-30% of the amount of the bank's assets they supposedly own, and you will be surprised - withdrawal restrictions will be imposed, with the promise of “we will fix it very quickly”. Next, most likely, funds from the state bank will be raised to finance/support such a bank, because otherwise it will be bankruptcy. And it could become a chain reaction.

[bestcoins1]

Agreed, we think Bitcoin is an alternative as your own storage bank, far from digital banks that continue to display the amount of your money, but different in value changes where the money you save will still have the same value while saving in Bitcoin you can monitor the fluctuating movements that occur in Bitcoin.

People who can already distinguish the value of money from the value of Bitcoin will understand better when they want to save Bitcoin for a particular purpose and also keep money for a particular purpose. Because it is very clear that a country's currency whose value tends to remain the same even though its value can also be eroded by inflation will not provide any benefit to its holders except for buying certain goods. While Bitcoin can be considered an asset and can also be considered a future investment which has the potential to provide benefits to its holders even though each holder must also know about the risks when Bitcoin experiences a price drop at a certain moment.

[WillyAp]

In case of banks, I'm pretty sure they don't have enough money to cover all the "balance" of their customers. That's why banks go bankrupt if people suddenly withdraw tons of money from their accounts. So there's always a risk here that the money is just numbers and you can't actually get it all (normally you can, but if too many people do it at once, it becomes impossible).

I'm sure it is correct for say 40% of the banks in the US, about 20% in the country I live in and whatever percentage in other countries.
Sure is that banks invest in businesses, make money and have a useful function in regard to state-building.

[Marvell1]

And have you ever witnessed cash shortages and services refusing to accept payments using bank accounts in your country or anywhere? I believe that has never happened and I have never encountered that in my country.

Actually, I have. This happened many times in the past (and still happens) in countries with unstable economies or during the transition of political systems. For example, during the financial crisis in Greece, many banks imposed strict limits on withdrawals and transfers.

You are probably among the lucky ones who live in a country with a stable economy and a well-functioning banking system. But unfortunately, many people don't.

Cash shortages can also happen and the banking system can also close if there is a war or natural disaster, flood...I have never experienced those things but I have read those news. But you cannot rely on those cases to blame or criticize the banking system...because those are unexpected incidents and do not happen often.

I am also a bitcoin investor like you, I am also not satisfied with many services that banks provide and I don't trust them completely either. But we need to realize that we cannot separate it from our lives or stop using it in our lives. So what good does it do us to speak ill of it?

[ultrloa]

Agreed, we think Bitcoin is an alternative as your own storage bank, far from digital banks that continue to display the amount of your money, but different in value changes where the money you save will still have the same value while saving in Bitcoin you can monitor the fluctuating movements that occur in Bitcoin.

People who can already distinguish the value of money from the value of Bitcoin will understand better when they want to save Bitcoin for a particular purpose and also keep money for a particular purpose. Because it is very clear that a country's currency whose value tends to remain the same even though its value can also be eroded by inflation will not provide any benefit to its holders except for buying certain goods. While Bitcoin can be considered an asset and can also be considered a future investment which has the potential to provide benefits to its holders even though each holder must also know about the risks when Bitcoin experiences a price drop at a certain moment.

People think about its safe to store fiat on banks since they think that they are safe from getting compromise. But they didn't even realize that they are wasting their time for deciding to do that since their main enemy is inflation and provably that they are just making the bank more richer since they can earn big with their deposit while them earn only few bucks or cents. But if they just invest it on bitcoin then maybe inflation maybe not their concern since the only thing they might consider is the rising up the bitcoins value and can get more better profits when it reach to another new all time high record. Although some people say its risky due to its volatility but we can settle up with this especially if we know how to deal with this characteristic and could able to accumulate more despite of the challenges we encounter.

[Jatiluhung]

It's just written or nominal. Which displays your balance in the bank account you have. But the money you save at the bank will definitely not be left to be kept in a safe, but the bank will use it to make a profit. So it's like lending capital to a bank. And banks use it to make more money. And in this case I prefer to use the bank for temporary storage only and not to store my money in the long term. Because apart from the risk of inflation, we also don't know how long the banks we trust will survive and not go bankrupt. That's why it's better to invest our money than to keep it in bank savings where our fiat will continue to be affected by inflation and its value will decrease.

[Cookdata]

That's why If we talking about "having the money" only if it's cash or crypto stablecoins.

Off course even some crypto exchangers show balance what they actually don't have but crypto exchangers not so scammy like Banks the Banks i remember fanny mae and other ones lent out mortgage deals what they did not have ownership and people in USA just lost homes.

This debate of been back by something is a long one and I think everyone will defend their own until the last. I'm talking about Banks fiat been back by something and cryptocurrency stablecoins been back by something. If you sit with some economists, they will tell you that fiat is more better because fiat is back by foreign reserve which is mostly dollars, check most countries central banks, that's what they do to protect their value and they will tell you that crypto is back by nothing, just air money but someone from crypto will defend crypto and say otherwise, it's a long debate.

You just need to know that what is keeping your stablecoins pegged to a dollar is because they backed by same fiats banks are using, if that accountability changes and sentiments is everywhere that USDT isn't backed by anything, the damage it cause in the crypto market will be beyond repaired. I just want you to know that Tether USDT is now worth more than $100b, pray it doesn't collapsed else we are doom already.

[Questat]

When you have crypto in your wallet, that's one story. If it's a noncustodial wallet, the coins are truly there, truly available. You might lose some value because the prices can change, but your balance in the currency you own is true.
In case of banks, I'm pretty sure they don't have enough money to cover all the "balance" of their customers. That's why banks go bankrupt if people suddenly withdraw tons of money from their accounts. So there's always a risk here that the money is just numbers and you can't actually get it all (normally you can, but if too many people do it at once, it becomes impossible).

The best solution here is never put maximum funds in your bank account, just a small amount enough to cover your emergency needs. If you save for your retirement, saving in banks is a bad idea. The interest is very small, and you can't have the assurance if all your funds are still intact. Unlike bitcoin, the amount of returns can be life-changing most especially if you hold it for more than 10 years, plus you know all your savings are intact since you are just saving in your own bank.

[mrmacintosh]

Once upon a time, the only reason I wanted a bank was to store my deposits and buy things online. Now I don't really need a bank for that anymore. I can either hold stuff in BTC or in a credit union even. Or Paypal or any other online bank account. I've been thinking for a long time about withdrawing from banks entirely. I honestly see them as the poorman's cash holder.

[ChiBitCTy]

This OP is a bit confusing the way you’ve worded it but if you’re asking if money in your bank acocunt is “safe”, the it would depend on a number of factors. Let’s take the United States. FDC insured bank accounts (most banks, especially most well known banks are FDIC insured) are insured up “$100,000” 250k. For a while in the US, the dollar was backed by gold, that ended somewhere in like the 1970s yet many citizens still believe it to be the case.

As with FDIC isurance, this classic scene in Tommy Boy comes to mind ( https://youtu.be/dAkSziqGk00?si=fPXV09r2hFYAD_o9 ).  Essentially it’s smoke and mirrors. If a large bank actually ever went under, I say good luck on getting your payout anytime remotely soon, if ever.

Now this is the US I’m referring to. Within other parts of the world your bank money is either not even remotely secure or maybe even a bit more so than within the U.S.  

Never heard of insured crypto accounts. Even if they are out there, I wouldn’t put much faith in them like I don’t with the FDIC.