Are banks needed for crypto? - page 5.

Hippocrypto

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Quote from: shaqer on October 03, 2021, 08:06:35 AM

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.

Depending on how the situation works out with loan, if every investments from bank would technically going to be successful I guess that's not a serious problem at all. Worst thing is that, taking loan risked so many things like monthly bills that we needed to tackle with. You just can't ignore payments while your crypto asset goes down in value, that's why you tend to lose your capital in many cases. So I don't really recommend bank as source of your crypto investment.

SquallLeonhart

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Quote from: Hydrogen on October 06, 2021, 07:57:50 PM

Banks definitely enjoy some advantages at the moment over crypto. Brand name recognition. Endorsement by public and private sectors. Trust from the public as a reliable institution.

Some of the advantages crypto has over banks are: flexibility, decentralization, trust less design paradigm, far lower barrier to market entry, et cetera.

Its common for people to approach the topic as if banks and crypto were two predatory animals that will be thrown into a UFC cage to do battle so a victor can emerge.

I think all people care about is having the best tool for the job. Whichever demographic, whether its banks or crypto, who offers the better product that gives people access to better opportunities and options is what they are likely to pursue. The free market determines the value, and worth of things.

There wouldn't be anything specifically changing, just a bit more decentralized and more like a wallet. So, right now banks work to make a profit, and the idea is not really that different from mine, the only thing different would be people would use it simply just for the storage part of it, I do not want to carry out too much cash? I will put it in the bank. It works perfectly for that purpose and that has been enough forever.

I do not believe that it should be anything more than that ever, loans and debts and everything else seems to be the main reason for this problem. Sure if you have a house and you want to get a loan then you can take it and your house will be sold if you ever fail to pay your loan back. However if you have nothing and you are still expected to pay back then it is not going to be fine at all, I prefer not to go with that route. So just.. a wallet service called banks, that's it.

BuNga_cute

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Quote from: Lanatsa on October 07, 2021, 06:05:01 PM

Quote from: Kittygalore on October 07, 2021, 01:59:14 PM

No way that crypto needs banks, I've been using crypto for a long time and I don't use banks just to convert or buy some crypto. Banks are a different kind of entity, it may coexist but merging isn't the best for both especially for cryptocurrencies.

Why people do really think off about merging or replacing fiat in the first place? Banks would remain as long fiat would be still there and its true that banks are regulated which means they do really need to

follow up on what government rules is.Crypto doesn't really need any banks because you could be your own bank on yourself and that's the beauty of it but we cant really deny that

we do still make out some active conversions which would be ending up on having fiat in the end of the day.

I find it hard to imagine a world without banks, because the government needs banks as a third party to control the people's finances. So no matter
how good crypto is, it will not replace fiat and if there is fiat, the presence of a bank is definitely needed. I've always thought it would be better for
crypto and fiat to co-exist, so they could complement each other. Indeed, crypto transactions do not require a bank, we can convert one coin into
another without a bank. But the problem is that not many merchants accept crypto payments, in fact there are still many countries that prohibit
crypto as payments. In the end we need a bank to convert crypto into fiat, so we can use it to buy what we want.

jaberwock

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Quote from: shaqer on October 03, 2021, 08:06:35 AM

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?

We can't say "needed" but do you really want to turn down such a powerful ally? I mean the only reason why I am in crypto is banks, I hate banks, I literally hate them, there are no organizations or business in the world that I hate more than I hate banks, I am using the word hate here.

However the moment I realized that banks could bribe politicians into getting crypto accepted and supported and loved by a government is the moment I realized that there is nothing wrong with accepting banks as allies. We can still use crypto without a bank if we want to, there is nobody forcing you to put your crypto in a bank or something, but if they are in our side, then it would be a lot more profitable for us for sure.

Lanatsa

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Quote from: Kittygalore on October 07, 2021, 01:59:14 PM

No way that crypto needs banks, I've been using crypto for a long time and I don't use banks just to convert or buy some crypto. Banks are a different kind of entity, it may coexist but merging isn't the best for both especially for cryptocurrencies.

Why people do really think off about merging or replacing fiat in the first place? Banks would remain as long fiat would be still there and its true that banks are regulated which means they do really need to

follow up on what government rules is.Crypto doesn't really need any banks because you could be your own bank on yourself and that's the beauty of it but we cant really deny that

we do still make out some active conversions which would be ending up on having fiat in the end of the day.

Smartvirus

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I was discussing with a colleague in the forum some time ago. I discovered that, for the few users that takes loan, some form of collateral was given often. Most times, it almost equals what your requesting just that, it might be usdt against bitcoin and I kept wondering, to what point is it!
How can I have usdt of almost equal value and instead of exciting it for the coin of interest and be about my business, I proceed to getting a loan. It doesn't makeups sense. What's the idea behind this sort this sort of behaviour because, I just don't get it at all.

Fortify

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Quote from: shaqer on October 03, 2021, 08:06:35 AM

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.

I don't think it is yet a reality that you can live comfortably and without major disruption in your life if you only have access to cryptocurrency. Whether you want to grab some fast food or fill your car up with gas, most mainstream companies still only accept fiat currency. It will be that way for quite some time, although we are seeing a gradual shift with certain companies trying hard to accept crypto, it will be a major inconvenience for the average consumer. Loans only work when you have trust involved and one of the underlying principles of cryptocurrency is the anonymity it gives to you, so it feels like you have to either pick one (by providing your identity to loan companies) or provide enough collateral to make the loan risk-free which is self defeating in most circumstances.

so98nn

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Quote from: Sterbens on October 03, 2021, 01:05:28 PM

The first thing you should pay attention to is the level of crypto price volatility. Not that stablecoins can be used to provide real-world loans, but whether a country can provide space to include crypto which until now is still in category 2, namely the investment group.
If we refer to the future, maybe it's not the time for us to say precisely. it is possible when the two institutions of decentralization and centralization can be combined in one financial system. Is that possible?

I think crypto loans are here since many years and there seems no issues with anyone: the lender and the borrower. Even the bitcointalk forum has it's own section for the same. Though volatility is a great issue in the crypto world then also the interest rates are decided as per the deal which sought at first and peeps keep paying accordingly. There are also projects for this purpose where escrows are set and loans are given away. Not sure where does the OP is stuck in terms of loan situation.
Banks are not needed at all. All you need is good escrow who can handle the both parties which I see as close to as bank itself. In fact involvement of third part add up more security too if it's valid source.

Kittygalore

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No way that crypto needs banks, I've been using crypto for a long time and I don't use banks just to convert or buy some crypto. Banks are a different kind of entity, it may coexist but merging isn't the best for both especially for cryptocurrencies.

breathlessz

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Quote from: macson on October 06, 2021, 01:44:32 PM

Quote from: shaqer on October 03, 2021, 08:06:35 AM

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.

I think we can only predict it, on the other hand the biggest power is in the hands of the government, while banks are under the control of the government, even though they have a better system, but I don't think it is easy to influence the government with all its advantages.

Hydrogen

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If you could design and build the perfect bank limited only by your knowledge and the depths of your imagination. What would it look like? How would it compare to current era banking institutions? Do people need better banks or would society be better served by banks offering fewer tools and options to clients: forcing the public to rely on them less?

Banks definitely enjoy some advantages at the moment over crypto. Brand name recognition. Endorsement by public and private sectors. Trust from the public as a reliable institution.

Some of the advantages crypto has over banks are: flexibility, decentralization, trust less design paradigm, far lower barrier to market entry, et cetera.

Its common for people to approach the topic as if banks and crypto were two predatory animals that will be thrown into a UFC cage to do battle so a victor can emerge.

I think all people care about is having the best tool for the job. Whichever demographic, whether its banks or crypto, who offers the better product that gives people access to better opportunities and options is what they are likely to pursue. The free market determines the value, and worth of things.

macson

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Quote from: shaqer on October 03, 2021, 08:06:35 AM

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.

geegaw

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Quote from: Sir Legend on October 05, 2021, 09:32:56 AM

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

justdimin

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Quote from: Ucy on October 05, 2021, 06:14:44 AM

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.

Sanugarid

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Quote from: Pejoh Asu on October 06, 2021, 06:29:58 AM

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.

Pejoh Asu

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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.

molsewid

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Quote from: cheezcarls on October 04, 2021, 08:27:24 AM

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.

CryptopreneurBrainboss

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Quote from: shaqer on October 03, 2021, 08:06:35 AM

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.

GeorgeJohn

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Quote from: Vaskiy on October 04, 2021, 12:52:56 PM

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.

Sir Legend

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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.

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