The founder of the cryptocurrency Mythos Fund Capital Ryan Sean Adams believes that «banks today is like a printed newspaper in the early 90-ies of the last century,» bearing in mind that the development of the Internet has meant that increasing amounts of information that gets people began to move on the computer screen, and later of the gadget. But print media still exist, trying to survive, including through better printing, attachments, samples of the goods as well as other devices that support interest in it. It has been almost 30 years since the advent of the Internet society, however, the print media survived, but the survival of banks faced with new technologies such as the blockchain and cryptocurrency.
The funding of any Bank is to attract depositors, and in average 80% of these resources is money individuals, only 15% — legal persons, and 5% is Central Bank money. Credit organizations are very sensitive to the phenomenon as «bank run», that is, when depositors massively withdraw money from their accounts: usually, even a decrease of 5% of the total Deposit base within a few days can put the organization on the verge of stopping their activities. In this case, usually the situation is saved by the Central Bank of the country by providing additional liquidity.
«Bank run» could begin for objective reasons (the uncertainty of depositors that banks are able tomorrow to meet their obligations by reason of non-confidence in the economic policy, which began disruption the release of the funds from ATMs and others), and subjective: for example, due to competition among banks or in politics. So, during the ongoing political crisis in France, which caused a surge of interest in cryptocurrencies, reports emerged that the country may face a «bank run», organized by the demonstrators. In the spreading of rumors about it took part of the face, not directly related to the political situation in France, such as «tweet-poet» Max Keiser is enough to recall his tweet in early December 2018. However, as noted by one of the inhabitants of Paris, «a mistrust of banks may arise in France, but obviously not now, but in ten years».
Banks currently are and begin to work closely with new financial technologies. So, the beginning of 2019 brought the news that the London Euro Exim Bank begins to use one of three technology platforms Ripple — xRapid. And it involved not just in experimental mode — this is already implemented in tens of the credit organizations around the world. It is important that the traditional banking system, in fact, started the process of dismantling the popularity of the system of Bank communications SWIFT, replacing her on some of these (for example, in Russia the banks that came under sanctions by the U.S., moved to a domestic analogue SWIFT), and clicking on cryptocurrency solution that includes the application token XRP (by the way, the technical condition is optional when working with all platforms Ripple). However, this is only a small step: still, the transaction will eventually lead to payouts in Fiat.
Similarly minor modifications to the banking system is its gradual manifestation of openness to working with cryptocurrency business. So, Silvergate Bank of California in the documentation submitted for passing IPO, reported raising $1.7 billion from 483 cryptocurrency companies, including such as Coinbase, Gemini, Kraken and bitFlyer. Thus, the Deposit base was formed cryptocurrency business but it is crucial that the money was still Fiat. As a result, we see that the big players in the cryptocurrency sector apply for banking services and place funds does not in any cryptocurrency Bank that only works with bitcoin, on both passive and active operations, and the organizations that deals in Fiat.
But even this interaction is not guaranteed. In Switzerland, considered one of the most favorably minded towards cryptocurrencies countries, accounts for these organizations opens a small number of banks. In Cyprus and in India there is a ban on working with organizations cryptocurrency and crypto-enthusiasts are working to change the situation.
Meanwhile, in cryptosphere there is no consensus about what to do with the first cryptocurrency. So, analyst Jimmy song argued that it is better to use for payment purposes is not bitcoin and Fiat with credit cards. The logic here is that it is better to save cryptocurrencies and not to waste them, though, on the other hand, what of the fact that the logic of the Creator of bitcoin Satoshi Nakamoto, it is intended to be a substitute for Fiat money? Recently, a review of the song criticized the author Talks podcast, Colin and crypto-analyst Tony Weiss felt that to spend bitcoin makes sense, if there comes a need and if there is no desire then buy them again. It is obvious that in this approach, the mass creation of cryptocurrency banks, which form the Deposit base and conduct all its operations only in cryptomath and not in any Fiat, at the moment unlikely.
Does this mean that banks may not fear for their place in the future financial system? For example, most bankers Belgium are confident that their organization is not. Colleagues of the Belgians over the ocean, in the fed, Express concern that FINTECH companies are set to redraw the banking sector, and their development can just be ignored. What cryptocurrency is a serious, confirmed Prime Minister of Russia Dmitry Medvedev: «If we talk about digital agenda, the figure is such a matrix, which in General are all now developing. Here it is necessary to Fund as quickly as possible, because otherwise we can’t do any work». He also stressed that «to something else you need to prepare…», giving to understand that the development of modern financial technology can have big consequences.
January 15, Medvedev warned those who intend to «bury» the cryptocurrency that you can’t do it, and you need to see in this phenomenon of «light and dark side, as any economic process.» Interestingly, two senior officials of the Russian government, Minister of economic development Maxim Oreshkin and Deputy Prime Minister Maxim Akimov, despite very sceptical about the cryptocurrency has mentioned the important points which arise in connection with this phenomenon. So … drew attention to the fact that due to the cryptocurrency come a large investment in the development of new technologies, and Akimov said that developing on the basis of the amount of cryptocoins financial services have development potential.
In the United States and Russia there is an understanding that financial technologies have great potential, however, the reaction is more cautious wait-and-see, or, as in the case with the SEC even the most critical. However, despite the presence of crypto-currency phenomenon in the life of those countries, truly groundbreaking events occur in other States.
Venezuela was to transfer all Bank accounts of citizens in public cryptocurrency Petro, but if this step still possible to consider, given the decentralized nature of this kryptonite, the levying of taxes in the form of various cryptocurrencies to the budget of the country without being converted to Fiat by the banks is already significant. Credit institutions becomes interesting to attract funds on deposits in cryptocurrencies. It is clear that this development in the banking sector Venezuela was the result of hyperinflation, loss of public confidence in local currency, when the cryptocurrency as bearers of values, perceived as an interesting asset.
Of course, the situation can go the other way: if in Venezuela a request for the cryptocurrency in the banking system was formed by the society, not the authorities, in the event of a sharp depreciation of the classic assets in the reserves of Central banks, and under the influence of the financial sanctions regulators can begin to replace them with the cryptocurrency, which was forecast to 2019 cryptographer Nick Szabo. In this case, the example of Central banks will lead to the transformation of the banking system in General in the Venezuelan scenario. However, as noted by the Winklevoss brothers, the fact that gold started to be replaced by cryptocurrencies, it is necessary for the proper regulation, that is, everything depends on the desire of regulators.
The scenario proposed by Nick Szabo may be carried out in individual countries, but overall, the changes in the banking system, which will lead to the disappearance of the need for its services, can begin because of wrong actions of regulators. Picky attitude towards cryptocurrency trading leads to a rise in the popularity of sale amount of cryptocoins on decentralized platforms. If the rate of increase in the needs of FINTECH companies in the financing is not eligible for the range of Fiat by the banks, businesses will increasingly switch to direct funding of cryptomath. And this will happen not only through the ICO, which becomes too problematic in a number of countries, and via the cryptocurrency lending.
In turn, this will lead to a greater spread of wage cryptomelane, that is, the emergence full of crypto-currency ecosystems, which cryptocurrency will be the focus of all necessary banking services. In such a situation the need for banks will begin to plummet, and it has become a fundamental «bank run» when the rescue of a credit institution is impossible: the regulators simply not enough resources. Yes, Fiat can print out and fill banks with liquidity, but in this case, the transformation of the banking system will have on the Venezuelan scenario. Thus, if regulators will strongly contribute to the development of cryptocurrency, what is in doubt, banks will be able to survive for quite a long time, but the more attempts to limit the spread amount of cryptocoins, the faster will come a time when banking services will cease to be necessary to society.
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