There's a ton of news coming out lately regarding financial institutions such as investing funds, payment services such as Paypal and even banks that are entering the cryptoshere and are buying BTC like there's no tomorrow. Probably that's the main reason for its price to hold and continue to go up that well in the past couple of months.
Tbh I doubt retail investors will have such a major impact on this bull market as they did back in 2017. Somehow retail investors are entering the markets in quite large numbers, but it seems they're doing that through the financial institutions, aka trusted funds, that are doing the job for them.
I read online recently that banks are on the verge to become trusted funds for the average Joes and offer to hold their BTC, in exchange for a fee of course, and that leads me thinking to the gold miners back in the days when banks offered themselves to get their gold and give the miners bank notes in exchange that they could spend while gold being stored safely by banks.
Kind of what they're probably going to do with BTC as well, which has proven the past years to be even more valuable than gold. Some say that this is the mass adoption that we were waiting for and that providing such services to their customers, banks will increase the number of crypto users all over the world.
Satoshi would probably not be too excited about it, and tbh I am not excited either and here's why... First of all, the worst nightmare of crypto and its cyberpunks is for BTC to get into the hands of the banks. At that moment, although the blockchain still decentralized, the main holders of cryptocurrencies, more precisely the trustees, will gradually turn into a centralized banking newtowrk, as more and more will rush to deposit their BTC(or any otehr crypto) at the bank, mostly for safety reasons of course.
Not your keys, not your funds and when the dirty old banks will get to put their hands on the freedom fighter of money(BTC)... we can't call that freedom anymore. For the moment, and hope I'm not wrong, nobody knows except me that my BTC address on my wallet is indeed mine and I can privately send satoshis to whoever I feel like all over the world in a private and safe manner in exchange of a transaction fee.
Hence the financial freedom and disruptive nature of crypto is still intact for BTC in this scenario, as there is no KYC policy for my crypto wallet and I'm the only one having the access to its private keys and to my crypto holdings. Once banks will offer custodian services for crypto they'll somehow become similar to crypto exchanges, but worse. A bit safer, but still worse in my opinion.
Being centralized by nature they will for sure hold the keys for their customers funds, ask for personal information before opening accounts, monitor and probably even store somehow every transaction of their customers crypto holdings and that's when we can truly say bye bye to the core fundamentals of cryptocurrencies. Who's there to talk decentralization anymore when a handful of oligarchies will be in charge of storing most of the circulating BTC...
Wrapping all this, leads me to the conclusion that banks entering the crypto world is not of bon augur. I intuitively knew that for a couple of years, and although short term the price of cryptos against USD will for sure explode, once the majority of cryptos will be held on crypto exchanges and banks, much of the financial freedom and privacy will be lost. I also believe that at some point banks will get that much aggressive and somehow come up with similar services to the ones of crypto exchanges, and being regulated by governments it will be quite easy to push some crypto exchanges off the cliff.
Now, I don't know about you, but I'm not excited at all about all these financial institutions, ESPECIALLY BANKS, entering the cryptosphere. Short term we will be quite satisfied about the price performance of cryptos, especially in the case of old investors, but on a long scale much of the financial freedom, privacy and entitlement over one's funds will be tied and totally in the hands of the banks.
What do you think? Excited about financial institutions, especially banks, entering the crypto markets lately?
Thanks for attention,
Adrian
Initially Posted Using LeoFinance Beta
