A story of money and the future of banking.
If you’re reading this, you’re probably like us – have pretty much all your wealth stored in digitized (or soon to be digitized) assets like money in your bank, mutual funds, stocks or real estate.
You probably have a financial advisor guiding you through your investments, a manager from your bank who helps you stay on top of your mortgage payments and a government that prints money responsibly to not de-value your lifetime of savings.
But how do you know if the bank manager or your financial advisor have your best interests at heart instead of their own fee and commissions? Your contract explicitly states that they are not responsible for your loss even as they verbally assure you otherwise.
How do you know that the digital assets won’t be hacked (traditional bank websites get hacked all the time)? Or that your physical assets won’t be stolen (bank robberies) or taken by fraud (enough examples in real estate)?
Governments fall all the time, or change their monetary policies - and your currency today can literally have no value tomorrow (Indian demonetization, Argentina, Venezuela, Zimbabwe). How do you know it won’t happen to your country?
Do you ask these questions? Well, we do all the time.
To answer these questions and why we created the Bank of Hodlers, we have to dive into the details of how banking evolved.
The government let the banks live by infusing 1.2 trillion dollars of the taxpayer’s money into a handful of banks and in turn, created the need, wave of innovation and a community for blockchain and the concept of decentralization to thrive.
Here’s Alan Greenspan (Chairman – Federal Reserve: 1987-2006), the guy who decided how much money to print in America, admitting that his model was flawed in 2008.
In 2009, something magical happened, Satoshi Nakamoto released his white paper which removed the need for a centralized authority to facilitate transactions in a purely peer to peer and decentralized fashion and making truly beneficial for every user holding the currency.
Countries will no longer enter hyper-inflation and your transactions will not be restricted or controlled by the government.
This Solution Has Its Drawbacks
technology Bottleneck of 7 transactions per second
It expects everyone to have and accept bitcoin as a legitemate currency
Some governments, after looking at the threat that bitcoin poses, have decided to take an anti-crypto stance. This ensures nation wide acceptance doesn’t happen at a scale where it replaces their national currency.
This is where we come in. At the Bank of Hodlers, we intend to treat your cryptocurrencies as a separate asset class and offer services to ensure technologies based on blockchain are usable as of today, negating the need for nation wide acceptance and government acceptance for them to disrupt the banking sector.
Why People Use Traditional Banks
Store of Value
The ability to keep their money in a safe place – bitcoin solves for this very well because:
The trust in the ledger > Trust in Banks
An easy and convenient way to spend their money in any place of their choice through a credit card – backed by their crypto assets. A clean and efficient overdraft system.
The ability for users to earn interest or borrow money as and when they like, without having the need to liquidate their crypto holdings.
Offer an insurance instrument in case of a hack in their exchange.