Sometimes there are things I can’t and won’t understand. As the title of this post states, I will tell you why I think that the banks we know today are pretty much outdated and should be replaced by something better at some point.
Why do I think so? Well, there are several reasons. One of the reasons is about time. How can it be for example that it takes up to two weeks for a cash remittance to show up correctly on the bank account statement, and in most cases also to transfer the money?
I live in Germany in the year 2015, so, how can something like this be true? As a web user who does often use PayPal and Bitcoin for transactions, I simply can’t understand why transaction with both of them just take seconds while my bank transaction needs several days and in many cases even weeks. Old banks are inferior and do lag behind.
I think there is probably not a technical reason why cash remittance with banks can take a lot of time. I think they work with out money, they earn interest with our money. That’s where I come to another point. Why do I need a middleman at all? A technology concept like Bitcoin does show that you don’t need someone to take care about your money, or manage your transactions.
I call it a technology concept as nobody knows if Bitcoin is the future way of money transaction. I mean, nobody knows if it will go mainstream. However, I think the concept, the idea and the protocol, that is the right direction. I think at some point it might happen, Bitcoin or something very similar to the Bitcoin protocol will replace banks as we know them. Yes, you read right, I think it’s long overdue. Banks are already a relict of old times.
PayPal had to register as a bank too, and while I like the usability of PayPal and the quickness how my transactions are handled there, I do think they have some high fees. That is another point I want to make and I do think that the future way of money transactions won’t plague with very high transaction fees. But if I talk about speed of transactions and the usability again, it must be mentioned that PayPal is superior to traditional banks. Even when I login there, everything does look more slick compared to the online banking site of my traditional bank.
Bitcoin does come with several advantages compared to my traditional bank too, and even with advantages over PayPal. With Bitcoin, transactions won’t be processed and verified by a central authority like banks or companies, because Bitcoin is a decentralized network that comes with all kind of benefits.
However, Bitcoin has several issues as well, especially when it comes to usability. You can cut out middleman services with Bitcoin if you install your own wallet on your system, but for non-tech people it is a little bit tricky to understand. That means the usability and security aspects are a problem. Then there do appear more and more services that make Bitcoin easier to use, but if you use them, you have again a middleman in the boat. There are some other issues like the high volatility, the value of Bitcoin is unstable, as it is at the moment heavily used for speculation as well. Bitcoin is at the moment still more something like an experiment.
But the point I wanted to make is that this is the right direction, regardless of whether it will be Bitcoin or something based on that protocol, or something that is just very similar, I think that is the future. I do say this because I can’t understand why traditional banks do need so much time for transaction processing, I don’t understand why we need a middleman service at all, and I see no reason for high transaction fees.
This is why I think traditional banks are outdated. I do think that they will be replaced at some point with a technology that is superior. It probably won’t be Bitcoin, it also won’t be a service like PayPal, but I am pretty much sure it will be a technology that combines the advantages of both. It will happen, and if it happens, the banks as we know them today will be history. I wouldn’t cry, I think we all would benefit from it. Who does trust banks anyway? I don’t.
Traditional banks will be a relict of old times because technology does advance, and technology makes unreliable things obsolete. I agree, sometimes this is sad, because not everything that got replaced by technology was necessarily bad, but in the case of traditional banks it would be a blessing for us all.