Can cryptocurrencies replace banks?

In recent years, the use of cryptocurrencies has skyrocketed. There is an increasing number of people interested in investing, saving or carrying out transactions with them.

There are many reasons why cryptocurrencies have gained this popularity; however, one of them is decentralization. All the transactions you make in cryptocurrencies are “anonymous”, which means that no government can tax you for them.

In addition, creating a wallet is free, without paperwork and in seconds you can have it. Operating with these is extremely simple and more and more people are joining this world. All this makes us wonder if these cryptocurrencies could replace banks in the future.

Today we are going to analyze this topic a little more and we will tell you and cryptocurrencies have the possibility of replacing banks.

Security, a very important issue

One of the factors that you should always take into account is security. Although cryptocurrencies can be quite safe, they are not as safe as a bank.

When you open a bank account, you put your funds in the safekeeping of the bank. Anything that could happen, the bank is responsible for those funds. For example, it does not matter if the bank is robbed, once you have deposited your money, it will be completely safe.

With cryptocurrencies this does not happen, since the only person responsible for protecting the funds is you. Although there are devices like Ledger or Trezor that offer much more security, it is not comparable to that of a bank.

Price

Another thing to keep in mind is the price. When you put your money in the bank, its value does not go up several times (unless the currency is devalued). This is something key, since with cryptos it does not happen this way and they are very volatile.

Probably, you say that you can save on a “stablecoin”, this does not mean that its price cannot go down. But cryptocurrencies in general are very volatile and their price can change abruptly from one moment to another.

Mobilization instruments

With a bank account you can mobilize your money in several ways, transfers, debit cards, credit cards and more. This is something that greatly facilitates making transactions. However, a cryptocurrency wallet does not have this facility.

The only way to move your funds is through a transfer from one wallet to another. This can make it a bit "complicated" to transact, as you will require the device and an active internet connection.

User Support

In the event that you may have some kind of problem with your bank account, you can go to an agency and solve the problem. Did you forget your internet banking password or your card pin? Don't worry, your money will continue to be safe.

However, we cannot say the same about cryptocurrencies. Because the wallets are operated by you, this means that there is no “support”. So, in the event that you have any kind of inconvenience, there will be no one who can help you.

Can cryptocurrencies really replace banking?

In reality, this is a future that looks quite far away and is not very promising. It is true that interest in cryptocurrencies has increased, but this does not mean that it will replace banks. In fact, it is very far from it.

Cryptos are a form of savings and a means of payment. These were not born to replace banks and do not work in the same way. That is why it is unlikely that they will end up doing it.

However, we do not doubt that banks will be able to offer custody accounts in cryptocurrencies. This means that you could open a wallet in your favorite bank. Of course, it could mean a significant loss of privacy and that decentralization that they enjoy so much.