Hurrah! Good news for those of us who feel the finance industry has in recent years screwed us over big time and continues in its belligerent ways unchanged.
I just saw an event that I believe marks the beginning of the end of "the finance industry as we know it". That event was today's hearing by the Senate Homeland Security Committee on the topic of digital currencies: Senate Hearing (go to video time 16:31 for the start of the hearing).
A new phenom has arisen via the Internet - decentralized digital currency. The witnesses and government leaders who testified on the subject today were for the most part in strong agreement that decentralized digital currency has a lot to offer that will benefit our jobs and economy and the people and companies that rely on financial services. They basically said that decentralized digital currency is a good thing and that we as a country should get on board with it. It will make our financial transactions faster, less costly and more efficient.
As it was with the start of the Internet, there is opportunity for abuse of this next major transformative innovation. But the panel for the most part agreed here too - the US is well positioned with existing laws and agencies to be able to control the bad things that will come up.
A couple notable paraphrases from the hearing:
- it's the centralized digital currencies that are the preferred currencies of the underworld, not the decentralized ones
- banks have been turning away checking account applicants who have anything to do with Bitcoin. We in the business of regulating the banks need to put a stop to this
Mark my word, from here forward, there will be major change in the finance world. And it will come on fast. Any finance exec who has half a brain is right now scrambling to deal with this invader to the financiers' private money orchard. Watch for the finance bigwigs to start squealing. And watch the stocks of these big banks and see if they don't nosedive:
| Rank | Name | Headquarters | Deposits (billions) |
| 1 | JP Morgan Chase & Co. | New York, NY | $1,009 |
| 2 | Bank of America | Charlotte, NC | $884 |
| 3 | Wells Fargo | San Francisco, CA | $785 |
| 4 | Citigroup | New York, NY | $774 |
| 5 | PNC Financial Services Group | Pittsburgh, PA | $193 |
| 6 | HSBC Holdings | London | $161 |
| 7 | Bank of New York Mellon | New York, NY | $160 |
The rise of decentralized digital currency will turn big banks and financial institutions onto their heads.
The "currency of the internet" promises to eliminate:
- high fees and inexcusable 3 to 10 day delays for money transfers
- high fees in exchanging currencies
- high fees to retailers by credit cards
The decentralized digital currency Bitcoin has been out there since 2009 and is rapidly growing. It looks like like it will be the one. Go here to see its current trend in trading value.
-------------------
http://www.geekwire.com/2013/bitcoin-surges-alltime-high-800-government-discusses-legitimacy-digital-currency/
Articles on banks' reactions to decentralized digital currency:
- Dutch Bank Rabobank is Blocking Customers from Buying Bitcoins
- Banking innovation depends on bitcoin
- Swedish bank freezes customer’s account after she sells 5 BTC
- Capital One closes company’s bank account over mere mention of bitcoin
- How scared are banks of bitcoin and what will they do about it?
What do you think about the potential for this to enable local currency?
ReplyDeleteThere is no reason the same system would not work for local currencies. already there is at least one other currency that operates with a cyrptocurrency system the same as the the bitcoins. Its called litecoin. some info on it here: https://litecoin.org/ and here: http://en.wikipedia.org/wiki/Litecoin
DeleteI'm sure it could be set up differently, for example so that only locals would do the mining, or other