Bitcoin or Banks? The Battle

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(Edited)

Authored by: @hetty-rowan

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Bitcoin or banks.

Who can you trust the most? You are taught from childhood that you have to have a number of things in order, because that's how it's supposed to be. You provide a permanent job, a contract for an indefinite period, because yes ... you have to work until you are at least 67. And of course you need a home for sale, because it's best to stay in the same place for the rest of your life. You find that one dream partner and marry it to grow old together, you have a savings account in your bank, and every month you have the bank automatically transfer an amount from your salary to that savings account. Depending on how much you earn, this can go up from a few euros/dollars to hundreds of euros/dollars. In short, you are ... even in this day and age, still supposed to pursue the ideal image of 'house, tree, animal'. And before you fit that image, few people think you've passed.

However, there are also ways other than the 'established order'. Not because it is by definition tough to kick against the established order, but because it might suit someone better. Instead of pursuing a permanent contract with a large company, you can also just start your own business as an entrepreneur. Or find pleasure and happiness in volunteering.

Instead of that owner-occupied home that will leave you crooked for the rest of your life in terms of mortgage payments and maintenance, you can also opt for a rental home. Or a houseboat. Or travel the world in a motorhome. Why? Because it's possible and some people think it's fantastic and never in their lives want to put down €1,000 per month for a room of 10m² in Amsterdam.

Instead of conforming to general terms and conditions and privacy measures that border on indecent control, you can also choose not to let a large bank watch every transaction you perform. It doesn't have to, but it certainly can!

Bitcoin or Banks: Who Can You Trust?


Banks: “Bitcoin cannot be trusted!”


Banks or Bitcoin, it is a struggle that may go on indefinitely. Banks are mad at Bitcoin. Because according to banks, Bitcoin is stupid. And unreliable. And annoying.

Bitcoin puts the finger on the sore spot of the current financial economy

The suspicion is that Bitcoin and the entire cryptocurrency industry is mainly seen as annoying. It puts the finger on the sore spot of the current financial economy on a macro level and is at the same time the solution to a number of those problems.
There are banks that willfully block transactions to crypto exchanges. These are not silly rural banks, but banks with a huge impact on the financial market. One of the biggest counterparts of the cryptocurrency industry is the 'Bank of America', one of the largest banks in the world. This bank has included in its General Terms and Conditions (Terms of Service) that accounts may be closed and terminated when they are used for one or more of the following promotions or purchases:

  • Illegal drugs or drug paraphernalia;
  • Firearms, ammunition or other weapons;
  • Sexually oriented activities or materials;
  • Pornography;
  • Obscene or offensive activities or materials;
  • Materials or activities that promote intolerance, violence or hatred;
  • Ponzi or pyramid schemes;
  • Illegal gambling, gaming, lotteries or lotteries;
  • Digital currencies, such as bitcoins;
  • Financing of terrorism;
  • fraud;
  • scam;
  • Money laundering; or
  • Any other illegal activity or purpose.

That's quite a tough list they have placed Bitcoin and cryptocurrency under, don't you think?

Preventing customers from getting hold of Bitcoin

It should be clear that banks have little faith in what Bitcoin can bring to the world. Even to such a degree that there is an active focus on preventing customers from getting hold of Bitcoin. Whether banks have a moral sense and are trying to protect their customers or whether they are trying to control and restrict their customers is, of course, an ethical discussion.

Is this for your safety, or because they are scared?

Because does it feel safe when a bank blocks a transaction abroad? Or does it feel like the bank is invading your privacy? Some will have the feeling that the bank considers his or her safety extremely important and thinks along with you and protects you. The other feels that the bank watches every transaction closely and doesn't let you keep control of your own money without interfering.
In any case, let's dive a little deeper into what exactly banks do and how it works with Bitcoin.

Bitcoin or Banks, The battle!

What do banks do?

Does a bank give you a sense of security? Or a sense of being controlled? Regardless of what gut feeling you have about a certain action, it is in any case good to take a look at the function that banks have within a society and the global economy.

it's time to take a look at what banks are doing and how they interact with their customers.

  • Imposing interest
    Banks charge interest and banks pay interest. This is actually a dead simple combination of saving money or borrowing money. Do you want to borrow money? Then you pay interest on the loan amount. Do you want to save money? Then you will receive interest on the loan amount. Fortunately, you don't have to think about this yourself and a bank will help you with this. Isn't it sweet? I will put the interest rates next to each other, you don't have to do anything for this either. Because I'm sweet too, (sometimes).

  • Borrow money (€ 10,000 at at least 5% interest)
    You borrow €10,000 from your bank and you pay 5% interest on this annually. If you repay this amount after a year, you will have to pay 5% x €10,000 = €500 in interest after one year.

  • Saving money (€10,000 at 0.01% interest)
    You save €10,000 in your bank and you receive 0.01% interest on this annually. If you still have this amount in your savings account after a year, you will receive an interest from your bank of 0.01% x €10,000 = €1.

Ironic to see that when you make $10,000 available to your bank, you get $1. And when the bank makes €10,000 available to you, it yields €500. Strange, isn't it?

  • Checking transactions
    If you transfer money to, for example, your parents who have emigrated abroad, the bank is immediately on the phone. Whether you are aware that an 'unusual transaction' is taking place from your account to a foreign account at that time.

Not that every transaction is checked. It's just a simple system of red flags and bells that go off at certain amounts, certain account numbers, certain types of transactions. You would say that this is the right of an institution that is connected to the financial market, but the question is whether that is actually the case. Ultimately it is your money and it is up to you what you would like to do with that money.

So is that call from your bank about that "unusual transaction" a sign of concern? Or a sign of 'Big Brother is watching you'? You can say it.

  • Expense Tracking
    One of the newer functionalities of many banks is the 'forecasting model' that you as a consumer can gratefully use. In fact, this is a part of internet banking, in which the bank shows which expenses you can probably expect, based on previously paid bills or collections, et cetera. Again, this feels helpful to many people and is therefore also introduced by the banks.

The other side of the coin is that a bank literally sees and keeps track of every transaction. People don't think about this so quickly, but if you do think about it, you can say that the bank monitors and checks EVERY transaction of yours. So also the transfer abroad. That order at an erotic webshop. That Bitcoin you buy. Where you eat out. Which hotel you sleep in. The list is endless and does not end. If you spend it, a bank will know. And if your bank knows, then your government knows too. Convenient way to control the population.

  • Block purchases
    When a purchase is blocked, it is extremely annoying. I am not talking about a direct debit that does not work because you are just a little less rich than you actually thought, but a transaction that normally should have been carried out, which is done by them for an underlying motive of the bank, bounced off.

Especially since this motive is often related to a moral objection. Although you are actually entitled to spend your money on whatever you want, in some cases your bank thinks otherwise. The question then naturally arises: “Who is actually in charge of YOUR money? You? Or your couch?”

But what about Bitcoin?

Even though Bitcoin is of course not a bank, it does not hurt to highlight some specific properties of Bitcoin to show the contrast. We'll grab them right away!

  • Bitcoin Privacy
    One of the most valued and feared features of Bitcoin is the level of privacy you get with it. Bitcoin operates with an unprecedented level of transparency that most people are not used to. All Bitcoin transactions are public, traceable and permanently stored in the Bitcoin network. Bitcoin addresses are the only data used to determine where bitcoins are allocated and where they are sent.

These addresses are created privately by each user's wallet. However, once the addresses are used, they are affected by the history of all the transactions they are involved in. Anyone can see the balance and all transactions of any address. Because a transaction only requires a Bitcoin address and an amount of Bitcoin, the privacy of Bitcoin is unprecedented.

  • Freedom of Bitcoin
    Because Bitcoin isn't bound to national borders, you don't have to deal with exchange rates and you are free to spend your Bitcoin when, where and how often you want. A Bitcoin in the Netherlands is just as expensive as a Bitcoin in America and you always have the option to spend or receive your Bitcoin, as long as you have a valid Bitcoin address and enough Bitcoin balance to send.

And whatever you want to buy, a Bitcoin transaction will never be disapproved. Come on, you must of course have enough Bitcoin in your account to be able to carry out the transaction, but otherwise it will always be sent.

  • Security of Bitcoin
    Precisely because the Bitcoin blockchain can be checked by everyone, the system is extremely transparent. Every transaction can be found. To ensure that this network runs smoothly, various nodes are present that monitor the transactions. These nodes ensure that the blockchain continues to work and remains intact and that more and more transactions are carried out.

It is impossible to take over Bitcoin's network. To do this, you would have to take over 51% of all computers that manage the network simultaneously, and then you are quickly talking about thousands of independent systems. The security of the blockchain itself is thus guaranteed. The security of your own Bitcoin is in your own hands. The most secure for this is a hardware wallet from Ledger or Trezor. This way you always have your Bitcoin physically and safely at hand!

Conclusion

Of course I'm not saying that banks can't be trusted or that in a dark office there are all very serious looking men looking at your account all day to keep an eye on what you do with your money. But there is no escaping the fact that the internal rules of the banking system have now had a certain effect on the feeling of trust and security.

And what about freedom? Especially when it comes to money that you have earned yourself, regardless of what with. Surely you should at least expect that you can do whatever you want with it!

It is important that you know what banks can and what banks will do. Just as it is important that you understand how the Bitcoin world works. Only in this way can you make a choice of what suits you best, and you might expect that in this century we would at least have that freedom of choice?

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16 comments
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Banks are still a necessary evil but the days are coming when we'll be able to almost skip banks entirely. Bitcoin is here to stay whether they like it or not and there are more cryptos out there that will continue to take dollars out of the legacy financial system.

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Yup, for now it is that way. But well, let's talk about this in 5 years again to see where we are standing at that time.

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@lbi-token I think people's currently have no other option instead of using both Bitcoin and banks side by side, because Bitcoin and cryptocurrencies are not a legal tender that's why people still needs some banks related services to cash out their funds like, bank account transfer and visa, mastercard services, ATM services but it's depends on a person what's his requirement or attention and what he preferred Bitcoin or banks

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I wasn't telling you that you could drop your bank account. This post was more informational about the difference in how banks are working, and in how crypto is working.

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I'll take crypto over a Bank any day. Banks charge stupid fees on stupid things to pay their employees and make profit. The thing with crypto there's really no employees or company to pay so you cut out that massive expense. No brick and mortar buildings to pay for either. Instead everyone that is part of the chain and helps secure it is an employee per say.

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I completely agree with you. Banks do charge stupid fees. I get every time annoyed when I see that they have debited something from my account, just because I have a bank account.

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when it comes to parking your savings bitcoin is a no brainer, but for now at least you can't (easily ) buy expensive items like cars or houses without the involvement of a bank, even if you have all the money and don't need to borrow. At least this is the case where I live

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Yup, very true at this time.

But this post was more to make the difference clear once again.

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Well banks are still the easiest way to transfer around money in our current society. There just isn't enough stores who actually accept crypto but this may change in the future.

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Unfortunately the same banks don’t follow the same rules that they establish for their clients. See: Wells Fargo, JP Morgan, HSBC, etc.

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Banking is cheating us, they don't want us to know more about BTC that's while they blocked the transaction in bank so that they will keep using us to make money but BTC has come to stay,bank can not stop us. BTC will continue to spread to all world.i always convert my money to BTC than leaving it in bank as money. BTC is preferable more than bank.

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