BANKS ARE GOING NOWHERE, and that's a good thing.

These subreddits are absolutely filled to the brim with delusional people, and it really needs to be addressed.

People seem to think that crypto will put an end to banks, and so many other wacky things like redistribute wealth....

NO!

Banks are going nowhere! They provide amazing services that people want and need. These services CANNOT be replaced by crypto, because crypto is incapable of replacing them.

So, what are these services that banks offer?

Custody

"Not your keys, not your coins" is the worst advice I see around here.

Yes, there are risks to keeping your coins on a reputable exchange/CeFi/ETF/Bank.

For most people the risks of self custody are far higher. 99% of people are incapable of securely/durably storing their seed - and we should not be encouraging them to do so. Most people on these subreddits have it written down on some paper and hidden somewhere, and as someone with a background in IT security, that knowledge makes me feel ill.

Plenty of people are willing to take the risk of self custody, and that's fine. That's their choice - and it's great that crypto has given them this choice!

However, most people need and want institutions to look after their assets for them. This is why banks were created in the first place. This is why people currently use banks instead of hiding money under their mattress.

This is not bad. It's just a fact of human life.

Loans

"DeFi is going to put banks out of business" is another recent one. Thanks, Mark Cuban.

DeFi is great, but it is impossible for it to replace Banks.

Why?

Almost all people who get loans from banks get loans because they don't have money.

To get a loan on DeFi, you need collateral. MOST PEOPLE DON'T HAVE COLLATERAL. They live paycheck to paycheck. This means they cannot borrow anything on DeFi.

You cannot take out a $1m loan from DeFi to buy a house when you only have $100k collateral saved.

DeFi will have almost 0 impact on Bank loans, because it cannot offer anything similar.

DeFi will have a small impact on credit cards, because it cannot offer anything similar.

You need buildings full of workers, and debt collectors, and so on... to be able to offer loans like banks do. Crypto CANNOT compete with banks in this regard.

Insurance / Reimbursement

Banks (US/Australia/etc) have government assurances on your holdings. FDIC insures up to $250,000 per bank per person. This is a big deal.

If your credit card is compromised, you will also be reimbursed for fraudulent payments.

Banks will offer crypto accounts with similar to FDIC insurance, and crypto credit cards with the same fraud protections.

Without banks, you're shit out of luck when you lose your money - and seeing as most people are incapable of storing their seed, it's going to happen to a lot of people... it already is.

Please stop with these fantasies about crypto killing banks. It's never going to happen.