SC5 founds a Bitcoin Bank | Bitcointalksearch.org

bb113

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Quote from: alexeft on April 02, 2013, 05:23:33 PM

Hmmmm, it sounds good.

Still, when a loan would be given, actual bitcoins would have to be taken out of the depositors' accounts for the debtor to have them in his own account, unlike the current status quo of fractional reserve banking where depositors and debtors all have all their money in their accounts.

Does that work?

I would think the depositors need to be confident that the bank can vet lendees successfully. It could work, pretty cutting edge though.

alexeft

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Hmmmm, it sounds good.

Still, when a loan would be given, actual bitcoins would have to be taken out of the depositors' accounts for the debtor to have them in his own account, unlike the current status quo of fractional reserve banking where depositors and debtors all have all their money in their accounts.

Does that work?

alexeft

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Let's imagine a bank in a bitcoin environment, meaning the bank and its peers (depositors and debtors) only operate in bitcoin. The roles of the bank would be:

1) A helpdesk for users that need technical help
2) Loan bitcoins to others.

But what happens when a debtor defaults on their loan? Since bitcoins can't be generated out of thin air, either the bank or the depositors take the hit. In essence, the bank becomes a place to risk one's bitcoins rather than a safe haven like the wallet already is. It doesn't really matter that their books are public, someone is going to default anyway at some point. Correct? Wrong? What do you think?

herzmeister

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In a free market, that means also in a free currency market, there is no such thing as an inflationary currency or a deflationary currency.

Because there is no currency that will be regulated top-down. We're largely only familiar to planned monetary systems.

In actuality, the differences between currency, commodity, and asset would dissolve.

Once the demand for bitcoins has largely satisfied, it will have to compete with any other asset out there.

It will stop acting deflationary when there are better stocks to invest in. People will put their money there then.

alexeft

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Quote from: ?? on ??

Omg, it will be decades before the banks get their heads around open and freely auditable books with all the money accounted for

nathanghart

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Quote from: Gordonium on April 02, 2013, 02:16:56 PM

Pays interest on Bitcoin savings

my skin just jumped off my body and hid under my desk....

alexeft

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Quote from: bb113 on April 02, 2013, 04:28:01 PM

Quote from: alexeft on April 02, 2013, 04:25:43 PM

Quote from: moni3z on April 02, 2013, 04:21:39 PM

Quote from: alexeft on April 02, 2013, 04:21:04 PM

Can someone explain to me what the use of a bitcoin bank might be?

I mean, why would I would to deposit my bitcoins with a bank if bitcoins don't really exist anywhere else except in the blockchain which is more like a public general ledger.

I would have to trust them with my private key, which, to me, is rather decreasing security.

To make interest while they loan out your coins, at least according to the press release.

This assumes that bitcoin reaches stability, else, this interest would come from borrowers who would have to face huge bitcoin value increases + interest.
Who would get a loan like that before bitcoin stability for the bank to make profit and me to get this interest?

And what about the risk? We are suffering from banks overlending our deposits. Look at Cyprus!

Businesses that get paid in bitcoin?

I suppose that's one case, probably the only one. Thanks

solomon

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Cool stories bros.

Can we confirm/deny the validity of the title of this thread?

moni3z

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Quote from: alexeft on April 02, 2013, 04:25:43 PM

And what about the risk? We are suffering from banks overlending our deposits. Look at Cyprus!

Read the press release:

Quote

Built-in autonomous mechanism for preventing the next bank crisis

The open books resulting from the 100% transparency promise mean that the customers can monitor the health of the bank in realtime. This in turn leads to an autonomous control mechanism. If the bank’s customers at any time regard the bank’s financial health to be below a trustworthy level, they will withdraw their money and the bank will collapse. As a result for the bank to keep on creating shareholder value it needs to stay healthy at all times.

Quote

100% transparency promise

All loans granted using the customers’ savings are directly transmitted from the customer Bitcoin accounts to the borrower account. You as a customer know exactly how much of your money is currently lent out.

hmm.. and I guess they will take foreign deposits though I don't know how this is possible with existing banking laws, unless of course this is an April fools joke

Quote

April’s special deal: All money moved from Cyprus will be guaranteed a positive interest for lifetime.

bb113

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Quote from: alexeft on April 02, 2013, 04:25:43 PM

Quote from: moni3z on April 02, 2013, 04:21:39 PM

Quote from: alexeft on April 02, 2013, 04:21:04 PM

Can someone explain to me what the use of a bitcoin bank might be?

I mean, why would I would to deposit my bitcoins with a bank if bitcoins don't really exist anywhere else except in the blockchain which is more like a public general ledger.

I would have to trust them with my private key, which, to me, is rather decreasing security.

To make interest while they loan out your coins, at least according to the press release.

This assumes that bitcoin reaches stability, else, this interest would come from borrowers who would have to face huge bitcoin value increases + interest.
Who would get a loan like that before bitcoin stability for the bank to make profit and me to get this interest?

And what about the risk? We are suffering from banks overlending our deposits. Look at Cyprus!

Businesses that get paid in bitcoin?

alexeft

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Quote from: moni3z on April 02, 2013, 04:21:39 PM

Quote from: alexeft on April 02, 2013, 04:21:04 PM

Can someone explain to me what the use of a bitcoin bank might be?

I mean, why would I would to deposit my bitcoins with a bank if bitcoins don't really exist anywhere else except in the blockchain which is more like a public general ledger.

I would have to trust them with my private key, which, to me, is rather decreasing security.

To make interest while they loan out your coins, at least according to the press release.

This assumes that bitcoin reaches stability, else, this interest would come from borrowers who would have to face huge bitcoin value increases + interest.
Who would get a loan like that before bitcoin stability for the bank to make profit and me to get this interest?

And what about the risk? We are suffering from banks overlending our deposits. Look at Cyprus!

Mosper

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Quote from: Zangelbert Bingledack on April 02, 2013, 04:17:28 PM

Quote from: Mosper on April 02, 2013, 03:04:57 PM

Quote from: alexeft on April 02, 2013, 03:03:24 PM

Quote from: Mosper on April 02, 2013, 03:02:11 PM

Quote from: alexeft on April 02, 2013, 03:00:41 PM

Quote from: Mosper on April 02, 2013, 02:56:29 PM

So long as the community around bitcoin is only interested in denominating the value of their goods/services/investments in USD instead of BTC bitcoin will remain a penny stock and have no chance of becoming a currency. The deflationary nature is a very bad thing for a currency to have and you are all slowly seeing why (while still not connecting the dots and continuing to think bitcoin will actually be a world currency one day). You're so close to getting it.

You tend to forget that bitcoin is really really young and little in capitalization, hence, it is unstable.
It will stabilize over the years and then it will be more easy to use for a greater variety of day to day transactions.

Gold is deflationary but nobody sees gold as bad!! Roll Eyes

The gold standard was abandoned for a reason?

Yes, of course. Goverments and bankers couldn't confiscate people's belongings via inflation. Don't you agree?

Inflation exists to insure an active economy and is not only a good thing but is entirely necessary for a functioning currency/economy based off of that currency. Out of control inflation can be bad but if your currency gets to pick one nature and your choices are inflation or deflation then the choice is obvious to anyone who doesn't have more conspiracy theories and paranoia than sense. Have you ever taken an economics class or read a paper or book in your entire life?

LOL. You swallowed your government propaganda like a good little schoolboy I can see. If the mainstream understood economics they'd stop being perpetually surprised at every development.

I don't have to swallow anything because I can read and infer things for myself as I have a functioning reasoning center in my brain. It's unfortunate that you suffer from the tragic libertarian syndrome. Your entire point of view is basically economic slave morality. It's hilarious.

moni3z

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Quote from: alexeft on April 02, 2013, 04:21:04 PM

Can someone explain to me what the use of a bitcoin bank might be?

I mean, why would I would to deposit my bitcoins with a bank if bitcoins don't really exist anywhere else except in the blockchain which is more like a public general ledger.

I would have to trust them with my private key, which, to me, is rather decreasing security.

To make interest while they loan out your coins, at least according to the press release. They promise a '100% transparent bank' where you will see at all times the amount of funds available in the bank and funds currently loaned out. I see it getting hacked into oblivion or only available to their employees.

alexeft

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Can someone explain to me what the use of a bitcoin bank might be?

I mean, why would I want to deposit my bitcoins with a bank if bitcoins don't really exist anywhere else except in the blockchain which is more like a public general ledger.

I would have to trust them with my private key, which, to me, is rather decreasing security.

Zangelbert Bingledack

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Quote from: Mosper on April 02, 2013, 03:04:57 PM

Quote from: alexeft on April 02, 2013, 03:03:24 PM

Quote from: Mosper on April 02, 2013, 03:02:11 PM

Quote from: alexeft on April 02, 2013, 03:00:41 PM

Quote from: Mosper on April 02, 2013, 02:56:29 PM

So long as the community around bitcoin is only interested in denominating the value of their goods/services/investments in USD instead of BTC bitcoin will remain a penny stock and have no chance of becoming a currency. The deflationary nature is a very bad thing for a currency to have and you are all slowly seeing why (while still not connecting the dots and continuing to think bitcoin will actually be a world currency one day). You're so close to getting it.

You tend to forget that bitcoin is really really young and little in capitalization, hence, it is unstable.
It will stabilize over the years and then it will be more easy to use for a greater variety of day to day transactions.

Gold is deflationary but nobody sees gold as bad!! Roll Eyes

The gold standard was abandoned for a reason?

Yes, of course. Goverments and bankers couldn't confiscate people's belongings via inflation. Don't you agree?

Inflation exists to insure an active economy and is not only a good thing but is entirely necessary for a functioning currency/economy based off of that currency. Out of control inflation can be bad but if your currency gets to pick one nature and your choices are inflation or deflation then the choice is obvious to anyone who doesn't have more conspiracy theories and paranoia than sense. Have you ever taken an economics class or read a paper or book in your entire life?

LOL. You swallowed your government propaganda like a good little schoolboy I can see. If the mainstream understood economics they'd stop being perpetually surprised at every development.

moni3z

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This might actually happen, sc5 did advertise they offer to pay employees in bitcoin so they are heavily involved with it. However none of us can get accounts there unless we are Finland citizens, or have a corporation there, and want to pay the gigantic Finland tax.

Mosper

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deflation is exactly what caused it though??? this is not something I made up?

kjj

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Quote from: Mosper on April 02, 2013, 03:39:32 PM

Quote from: bb113 on April 02, 2013, 03:30:43 PM

Quote from: ?? on ??

I don't know dude what about the fucking great depression? It's hard for me form an informative argument when you lack a basic understanding or education on the topic. Seems like the length of your understanding is regurgitating things you sought out with the intent of proving the thing you already believed.

Seriously, the great depression argument. You are on a bitcoin forum you should already know why that is unconvincing. Sorry, go read more papers and books, this time think critically about what they say and perhaps go read opposing points of view to get some ideas of why your claims are not accepted by others as "axiomatic".

Only bitcoiners and internet libertarians think there is no Data. You're going to get more Data exactly the same as every example of what deflation causes and then ignore that too.

Quote

Can you guys stop feeding this troll? He's already devolved the conversation to name-calling, you won.

Ah yes anyone who interrupts the echo chamber must be a troll.

Dude, grow up. These forums have a thousand threads on the deflation topic. You've added absolutely nothing to the debate. What was missing was not one more person repeating the premise. You will get nowhere by claiming that you don't need to make any arguments because your opinion is "axiomatic".

Also, the great depression came after the federal reserve system was launched. Since the federal reserve's entire purpose for existing was to insulate banks from the negative effects of the inflation that they were causing, it seems a bit silly to claim that as a data point against deflation.

bb113

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Quote from: jwzguy on April 02, 2013, 03:38:03 PM

Can you guys stop feeding this troll? He's already devolved the conversation to name-calling, you won.

Has anyone confirmed that this SC5 announcement is not an April Fool's joke? Because it's pretty big otherwise.

Yea, I have also concluded troll. Namecalling, no data, using simplistic arguments, etc. One day he may get an economics degree at which point he will stop the namecalling. Grin

Anyway, heres the guys twitter:
https://twitter.com/pyryl/status/316527162771521538

Mosper

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Quote from: bb113 on April 02, 2013, 03:30:43 PM

Quote from: ?? on ??

I don't know dude what about the fucking great depression? It's hard for me form an informative argument when you lack a basic understanding or education on the topic. Seems like the length of your understanding is regurgitating things you sought out with the intent of proving the thing you already believed.

Seriously, the great depression argument. You are on a bitcoin forum you should already know why that is unconvincing. Sorry, go read more papers and books, this time think critically about what they say and perhaps go read opposing points of view to get some ideas of why your claims are not accepted by others as "axiomatic".

Only bitcoiners and internet libertarians think there is no Data. You're going to get more Data exactly the same as every example of what deflation causes and then ignore that too.

Quote

I am VERY worried about you calling me ANY name Angry
I NEVER gave you the right.

For my own sanity I am going to go on believing this is a joke.

Quote

Can you guys stop feeding this troll? He's already devolved the conversation to name-calling, you won.

Ah yes anyone who interrupts the echo chamber must be a troll.

Topic: SC5 founds a Bitcoin Bank (Read 3636 times)