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RE: Why are banks so profitable?
Simple analysis, yes but a very good one @culgin.
Banks are very profitable and the fractional reserve banking is key to their model. Also, many of the big banks are market makers so they are basically establishing the spread in many markets.
Using just the first part, that is why it is vital for us to get more of our holdings in cryptocurrency. Every dollar held in crypto removes $10 from the established banking system. If we just focused upon this aspect of the banks business, we would see a major impact.
Over time, I have a feeling this will be the trend. As there is more to do with crypto i.e. places to spend it, we will not see people converting it back to fiat.
This will eventually take a toll on the banks.
Indeed. People need to learn to take charge of their own money. Though the problem I see is that the vast majority are still too use to the existing system.
Cryptocurrencies still have some way to go to make it seamless for less technical users to start using them. However, as millennials and future generations come to age, that will be less of an issue. In addition, crypto usage experience is also improving by the day which is really encouraging :)
Hopefully... And to be honest... I think tha banks will either have to transact eventually on blockchain or be removed from the "very big transaction game". And this will be something that either the "regulation" can prohibit... or allow criminals to coexist. Maybe there is a third or fourth term/state in this, but mostly it will be hard nails on your feet.
I would love for little students to start making thesis of Financial markets evolution... and how crypto transformed them in terms of dept liquidity... which is something crypto does not really still have.
Anyway, enjoying this amazing revolution is going to just make my life more interesting. I am on it since 2013/14... but I never though it would be like this in 2019...