Topic: Do you agree with idea "Bitcoin bank" ? - page 92. (Read 142276 times)

i do not mean that you personally are wrong, but most people have a wrong idea of the things a bank does. You go to a bank and give them your money and they pay you some interest for it.
So some people think they will lock the money in a safe, keep the money safe and there it will wait for your return. but banks do not do that. not even if you ask them to. Banks do not store money, they invest your money. the only way to store money in a bank is to put cash in a deposit box in a bank. for that you pay instead of getting an interest rate.
Most people think they put your money to good use, like loaning it to other people. But sadly this is wrong again. And here comes a thing called fractional reserve into play. let us say you deposited $100, then this means that they can give someone else a loan of up to $1000. they take your $100 and just make the other $900 up. They act like they have more money then they really have. This is a scam to me, but it is legal. So even if someone asks only for a loan of $100, they will not give them your $100, but take $10 of your $100 as reserve and make the other $90 up, so they can loan out $100 and keep your $90 for someone es who is willing to take out a loan. They do this because this is how they make money. They create money. They want you to take a loan.
Here is something i like: let us assume you want to buy a car and need some extra money to afford it. You go to your bank and take a loan to buy the car. As insurance for the loan you bank accepts your new car. This means you get money from the bank and pay the seller of the car and the car is yours, but if you fail to pay back your bank then your car will become the banks car. Why does the bank not just buy the car from the seller and you pay the bank until you have paid the full price and the car is yours and if you fail to pay them, then the bank owns the car. This can not be done, because the bank does not have the money. Only by taking out a loan they create the money. And by creating money they earn money, so they want you to take a loan.

I don't quite understand what you exactly mean by me being wrong

When I open a deposit in a bank, the bank sets the interest rate which it will pay on my deposit. Whether it is going to sit on the money or reinvest it, I pretty much don't care as long as they don't scam. I can't possibly see how this type of investment is different from any other investment, apart from a fixed interest, of course. On the other hand, it is expected that the bank would be loaning my money to other people and earning profits, part of which it will share with me

It was a soft comparison, and not a direct hit. Nothing prevents web wallets or exchanges to hand out bank-like features such as loans, or exchanges that allow their traders to loan out their coins through the exchange's platform (which is already a reality). The main fact is that people still take the term "Bitcoin bank" way too serious. They see it as an official institution which it's obviously not.


If the fiat monetary system is being hammered on, how would that not translate into the real world economy experiencing the negative effects as result of that? They are closely tied to each other.


Correct, but that's not how governments look at it. Especially when it comes to something as Bitcoin that they have zero control over. In that regard, they are better off creating their own digital currency with the exact features of Bitcoin, but with the government as central point.

I see that i have to explain more. You can do one of two things. Store or invest. If you want to store your Bitcoin do so on your computer. If you want to invest, then invest in something that creates value.
When it comes to storing, then i can do a better job then a bank. if i still feel the need of an insurance, then i do it directly with the insurance company and bypass the additional fees the bank will take for it.
If i want to invest, then i have to give my money to a company (unless i want to start my own and invest in myself). In this case it does not matter in which form it is. It can be Bitcoin, fiat or whatever we agree on. There is always a risk involved.
If you think you can give money to a bank and they just store it for you, which means that they do not invest it, and give you an interest rate on top of that, then you are wrong. Because if they promise an interest rate, then they do invest that money, they just do not tell you about it. If they make a good profit, then they keep the earnings for themselves and just pay you the promised interest. But they can also lose and if they lose to much you might not see your money, as this is not risk free. 

I don't think this is a correct view

The difference between banks and other financial institutions such as web wallets (even if they have the word bank in their name) is that banks can loan money to borrowers while web wallets can't. This is a distinguishing feature of any genuine bank (i.e. attracting money from depositors and loaning it to borrowers). Regarding governments never supporting something which could potentially bring harm to their economy, it is also debatable. Bitcoin would most certainly cause damage to a fiat monetary system as such, but not real economy. In fact, anything that would facilitate the exchange of goods better than the currently existing system could only push the real economy forward, not hurt it

Uhmm I don't know anything about your logic but for me Bitcoin Wallets are as good as banks for holding the Bitcoin you have. With its given volatility it's more than any Interest bearing savings account in a bank. Putting money in a bank is just making big companies even richer while our money is not anywhere near what we expect from it.

Sheeple will always want someone to hold their hands & money and tell them what they can and can not do. The entire concept of Bitcoin is to get away from traditional banking mentality. You're your own boss, you're the Bank. Why do people have this need to be dominated in the most critical aspect of their lives: Finance.

I don't get it.

You seriously have no idea what you are talking about. You compare traditional banking to a service such as blockchain.info that might call itself a Bitcoin bank. Because that's exactly what it will be. Look at Xapo, Coinsbank, Coinbase, BitPay, these services can also be seen as a Bitcoin bank. Governments will never support something that goes against all their values and potentially can do a significant amount of harm to their economy. This is something that a certain number of people still haven't realized.

Your post is packed with self-contradictions like a flea-bag with fleas

You talk about investing in some company or something and at the same time insist on storing bitcoins locally, in your computer (or paper wallet). How is giving the private keys to someone else different from investing the same bitcoins in some company? You would still have to give your keys by transferring the funds. Further, how investing in something differs essentially from investing in a Bitcoin bank? If the Bitcoin bank pays you interest doesn't that count as an investment in its own right already, any way you look at it? And last but not least, if banks are legally allowed to accept your bitcoins, they could insure them, and in that very case they would be protected better than the coins in your personal wallet

How about your computer, a paper wallet or something else to store YOUR coins. Because if you give the private keys to someone else, then it is not your money anymore. What is real interest? if you want to invest the money, then invest in some company or something. money does not grow just by keeping it looked away. Please explain to me how a bank can protect me better against the national law then i can do myself. 

Why not a bitcoin bank?
I think can be a fantastic opportunity, get a place where you can store your coins, get really interest, get "protect" by the national law... 

the idea of bitcoin banking i think is a welcome idea because it will become an avenue for people to more of the existent of bitcoin and it value to the economic and as such bringing the government to make it well know to the people and hereby been accepted by people in the economy so bitcoin bank is a good idea

Bitfinex? You must be kidding mate. Somehow, a lot of people who are just using Bitcoin are using it through one of the numerous web wallets available in Internet. If it ever comes to calling names, a Bitcoin bank would be a fancy name for a web wallet not an investment. Strictly speaking, you could hypothetically consider web wallets as a sort of investment too. I mean those web wallets that pay transaction fees for you and thus allow you to save on the fees in comparison with desktop wallets...

But penny saved is a penny gained

Honestly this is a 50\50 decision as this would mean easy access of buying and selling of bitcoins and also require some personal info on users using the service to sweep out fraudulent activities
I would like to see this bitcoin bank as a pilot project to see how this goes

yeah of course there are advantages and disadvantages in bitcoin bank. and of course there are supportive and some are cons. I think bitcoin bank circulated freely, because back again on each user's use it or not it's up to their own

I really have to disagree. If you are just using bitcoin, then you don't need a bitcoin bank. A bitcoin bank is just a fancy name for a bitcoin investment. They want to sound like they are providing you with safe returns when you might as well just loan out your coins on polo or bitfinex and have the same amount of counterparty risk, of them doing a runner.

I guess it would largely depend on specific terms

There are quite a few folks willing to lend their money. If they lend this money through a real bank which requires a real collateral to be provided, and the interest they would receive is satisfactory, I don't see why they wouldn't do that. After all, when they lend bitcoins directly, they are still facing basically the same risk, but with Bitcoin banks, it should be way lower on average

What do you want a bank for when your wallet already is a bank?

You want to loan money out so deadbeats that can't work can make millions off your money.  When a bank loans money and the deadbeat that borrows it does not pay it back?  1. The government bails them out.  2. The deadbeat and their posse blames the bank and sues them and the bank pays a fine.   3. Some deadbeat borrows millions of your money makes twice your money then gives you back 2% for your time.   4. The bank owners give themselves loans and buy companies with your money.  5. All of the above

If you don't know the answer is 5 read the books.

Well yes, Millions of people are using web wallets but they have faith on the web wallet service provider (at least say that is what they have been told by these services), but when it comes to reuse of funds how many of them would grant permission to use funds from their web wallets for the purpose of lending it to others?

There would be a fundamental difference between lending sites and Bitcoin banks

As far as I understand it, lending sites themselves don't lend anything, they just bring together potential lenders and borrowers. I can't really imagine what kind of collateral could be used online, especially if you are going to borrow a few dozen bitcoins. I've seen arguments that altcoins could be used as such, but as to me, this is complete garbage. If you need money, and you have a stash of altcoins, go and sell them. If you can't, you can't use them as collateral. Bitcoin banks, on the other hand, could demand and receive genuine collateral, for example, real estate, cars, shares, etc


Millions of people are already using web wallets and willing to hand over their funds to these even if they are paid no interest on the transferred amounts