Something is changing around Bitcoin. The price of Bitcoin may have been stable in the $ 9,000 – $ 10,000 zone for several weeks now, the real signal is elsewhere. This signal concerns the adoption of Bitcoin. From Visa to PayPal, more and more players are deciding to enter the world of Bitcoin. From now on, it is American banks that will be able to buy and hold Bitcoin for their customers. If this sounds like good news to you, I will try to make you aware that reality is more complex than it looks.
Bitcoin (BTC) in the firmament
The good news has been piling up for Bitcoin for several weeks. First of all, we saw that a growing number of institutional investors were switching to the purchase of Bitcoin via Grayscale investments.
Then it was around PayPal to announce that he was working on a solution to provide access to buying / selling Bitcoin directly from his platform.
Things look set to speed up now with the US banking regulator, the Office of the Comptroller of the Currency (OCC), which just announced that it now allows US banks to hold Bitcoin for their customers.
A logical decision
This authorization given by the American banking regulator goes with the grain of history in more ways than one. The demand for Bitcoin from American citizens has been growing significantly for several months. The great monetary inflation that we are currently experiencing is not unrelated to this.
Many Americans are now looking for new solutions to protect their wealth. Bitcoin appears to them as a new solution to be tested.
On the other hand, banks’ hostility to Bitcoin is slowly fading to give way to an appetite for this asset with impressive returns.
The time when the CEO of JPMorgan Jamie Dimon qualified Bitcoin as a fraud seems very distant. However, these statements barely date back to the end of 2017. This is to say how far Bitcoin has come in just under 3 years.
Today, JPMorgan even offers its banking services to major crypto companies such as Coinbase and Gemini.
The narrative used by the banking world to denigrate Bitcoin reaches its limits. A growing body of research confirms that Bitcoin is not used just for money laundering or illicit activity. In addition, it has already been found that using Bitcoin for illicit activities is more difficult than using the US dollar.
The massive hack just suffered Twitter shows how difficult it is for hackers to launder the Bitcoins they have just stolen. This is one of the big lessons the Twitter hack teaches us about Bitcoin.
Bitcoin blockchain analysis companies scan in real time all transactions made from the address used by hackers.
Bitcoin is a public ledger (ledger) which offers unparalleled transparency in comparison with the banking system where the most total opacity reigns. This has enabled many banks to facilitate money laundering over the past decades.
Little by little, the reality on the revolutionary side of Bitcoin is taking precedence over myths and clichés.
Many see a bullish signal for Bitcoin, but it’s more complicated than that
Many see the announcement by the US banking regulator as an extremely bullish signal for Bitcoin in the months and years to come. I’m not going to say the opposite.
Making the purchase of Bitcoin available to more people is bound to be something which can sharply increase the price of Bitcoin.
Of course, nothing says that customers of American banks are going to pounce on Bitcoin however. Nevertheless, many will buy Bitcoin ” just to see ” as they like to say.
I may disappoint some, but I have the feeling that despite everything, the fact that American banks can buy and then hold Bitcoin for their customers is not a good thing for the bitcoin revolution.
Banks are at the root of the problems of the current monetary and financial system as explained Satoshi Nakamoto:
“The fundamental problem with traditional money is how much confidence it takes to make it work. Trust the central bank not to degrade the currency, but the history of fiat currencies is full of breaches of that trust. We have to trust the banks to hold our money and transfer it electronically, but they lend it in waves of credit bubbles with barely a fraction in reserve. We have to give them our privacy, trust them not to let identity thieves drain our accounts. “
Banks are part of the problem, they can’t be part of the solution
Satoshi Nakamoto created Bitcoin following the banking crisis of 2008. He explained that the current system requires being able to have total confidence in central banks and private banks.
However, private banks have always betrayed the trust of their customers. The greed and corruption of the banking world has led to a whole lot of excess. I’m talking about the waves of credit bubbles, or the censorship of customer assets. This censorship also applies to the transactions you wish to carry out.
Banks therefore clearly cannot be part of the solution to the failures of the current system that Bitcoin embodies.
By offering to buy Bitcoin for their customers, US banks will be in possession of the private keys of the Bitcoins.
American banks will therefore always have full control over the assets of their customers. Bitcoin was created to give you freedom over what you own.
If a bank has control over the private keys of your Bitcoins, she can confiscate them from you.
Buying Bitcoin through a bank is total nonsense
Buying Bitcoin through a bank is therefore in total contradiction to the spirit of Bitcoin. Bitcoin empowers you to take control of your money destiny.
The risk of censorship will always be the same as with the current monetary and financial system.
Another essential mission of Bitcoin is to enable financial inclusion millions of people. These have always been excluded from the current banking system.
Bitcoin aims to bank the unbanked. Bitcoin is already enabling thousands of people in Africa especially. In the future, this is where the adoption of Bitcoin will explode in my opinion.
People excluded from the current banking system will also be excluded from a system where the purchase of Bitcoin is done by banks. In reality, there are a lot more risks and constraints in customers buying Bitcoin through their banks.
With Bitcoin, you become your own bank with all the advantages and responsibilities that this entails. By letting your bank be in control, you can become unbanked in the Bitcoin system at any time.
People who welcome this important news of allowing US banks to buy and hold Bitcoin for their customers have, in my opinion, a purely pecuniary and speculative view of Bitcoin.
Of course, the price of Bitcoin is indeed expected to increase as a result of the purchase of Bitcoin by customers of US banks.
Unfortunately, this increase in the price of Bitcoin will come at the expense of the true values of the Bitcoin revolution.
So I think a lot of education needs to be done by Bitcoiners. They will have to explain to the general public that buying Bitcoin must be done live. This is the only way out of the current system and take full control over what you own.
This implies that you will then be in charge of the security of your Bitcoins. With a little training, it doesn’t have to be that hard. This is a small price to pay for being truly free. In my opinion, the game is clearly worth the effort. But as always, the final decision is yours.
A developer by training, I discovered Bitcoin in 2014 but did not immediately grasp the importance it could have for the world of tomorrow. I took a more in-depth look at it from the start of 2017 and I haven’t let go of it since.
Passionate about Bitcoin and the new system it is trying to build for the future, I decided to participate in its evangelization at my modest level by writing about Bitcoin, Blockchain and cryptocurrencies on different media.
It is with pleasure that I publish some of my texts in French on The Coin Tribune.
I also write quite a bit about personal development and self-improvement.
Please feel free to connect with me via social media or in comments on my articles if you have any questions regarding my articles.