Cryptocurrencies and its role in our world is a hot topic these days and its truly a very complicated subject.
On the one hand you have ultra speculative gambling traders that are in the space for playing trading poker against other similar gamblers.
On the other hand you have an increasing centralization of what was initially intended to be decentralized.
But at the base of it all, is you have truly beautiful technological protocols that simply work.
While my focus this whole time has been on analyzing the pros and cons of cryptocurrency I forgot to really reflect on a key component, i.e: on how things are and work NOW.
A recent encounter with the banking sector gave me a rude awakening into how the current system is clearly on its way out.
Opening a bank account
I tried to open a new bank account.
The first bank I went to had me fill up some forms, bring in all my original documents, asked me a lot of questions and eventually just disappeared with no further communication.
The relationship manager told me that it has gone to ‘compliance’ and that he no longer has any control over the process.
I waited 2 weeks and then gave up on that bank and went to another.
With this second bank – things were a bit smoother, I submitted the application online and was asked to come to a branch to complete the application.
Here again I was tortured with truly silly questions like how much profit do you plan to make and how much do you plan to spend and what is your mothers maiden name etc.
2-3 days more of paper pushing and I had my bank account ready.
Mind you, it actually was PAPER, i.e: piles of paper printed and handwritten on, stamped and signed.
Btw – I was not applying for ANY form of credit, just a savings account with no cheque book, no credit card, no overdraft. Just a purely debit account.
What is a bank account?
So 3 weeks later, I have a plastic card and a login to ‘online banking’.
Here is the thing, a bank account is simply a user account to the banks software – nothing more.
The bank has a centralized database, gives you a database ID and facilitates transactions, which are basically just database records.
It took me 3 weeks and lots of nerves to simply gain access to a software, without any liability or exposure for the bank.
I can now receive and send money. Hurrray.
The funny thing is, if I wanted to recreate this process with BTC or ETH it would have taken me a grand total of 3 minutes at the most.
Even actually using the account is far more difficult – sending money from bank to bank takes 2-5 business days and lots of info.
On a user experience level, from the point of view of the actual act of creating a ‘wallet/account’ and using it – cryptocurrencies win hands down over any current fiat structures.
Long term, I think the 2-3 cryptocurrencies that work out the transaction payloads and grow to enough volume where volatility stops being a factor, we will inevitably be living in a future where current banks will either simply become blockchain based wallet providers or die.