Why does our banking system need to change? It’s a topic that seems to be generating a lot of interest these days.

Perhaps it’s because our government is recklessly exploiting the fact that we are a financial reserve currency in a fiat monetary system. However, for the sake of this article, let’s not even go there. Ultimately, the people are the ones who established the banking system and they are the ones who will change it. In fact, they already have, if we’re being honest.

Unfortunately, a few politicians who are largely uninformed about this new innovation and whose focus should be elsewhere are trying to shape it. I won’t delve into the political side; suffice it to say that individuals have created a system that functions safely, more effectively, and at a lower cost, without any government intervention thus far. It’s hard to believe such a thing is possible!

So, with the rant avoided, why does our banking system need to change? Is it because there’s a new power and we need to keep up with them? Maybe. It definitely wouldn’t hurt to stay ahead of the curve or at least with it.

Is it because the banks exert too much control over who gets loans and are willing to risk assets with corporations but not with potentially harder-working individuals? Well, they certainly have too much control over who can borrow money; there’s no debate there.

Is it because when you sign up with a bank, you essentially give them carte blanche to do whatever they want with your money? Don’t get me wrong, you’re insured by the government up to a certain amount, but technically, it’s the bank’s money. I mean, we all know that a system where you can securely hold your own money outside of a mattress, without involving a bank, is impossible, right? Or is it?

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Do we continue to have fraud scandals in our banks? It’s worth remembering that the main reason for the existence of banks is to act as intermediaries and ensure everyone’s money is safe. After all, it’s our money we’re talking about. Yet, scandals continue to happen because banks don’t always act solely as the ledgers they’re supposed to be. The most recent example is the Wells Fargo scandal, which you can read more about in this Forbes article. I’m sure you’ll find some logical reasoning behind the outcome – sarcasm.

However, one of the main reasons we shouldn’t stop or restrict innovators is because of one of the most basic reasons I can think of. I’ve chosen to focus on this reason not because it’s the most important, but because it’s the least “political”. Honestly, it’s blatantly ridiculous that it hasn’t been addressed yet. Not to mention, it has probably affected everyone at one point or another.

When I want to transfer my money from one account to another on a Sunday morning, I shouldn’t have to wait until Tuesday for the transfer to be completed. It’s really because the banks are slow. Let’s be honest, it’s also because they’re lazy. They don’t care to build a system that gives us easier access to our own money.

Banks don’t have R&D (Research & Development) departments, they have investing departments. No one can blame them though, as they’re only there to keep our money safe and give it to us when we want it. While they’re arguably doing one, they’re hardly doing the other. Arguably, because inflation means our money is slowly degrading into worthlessness. Hardly, because of what I’m about to explain.

Why, if I want to transfer money from one account to another on a Sunday so I can use my rewards debit card online, do I have to wait until Tuesday? Well because there’s a public holiday on Monday, of course. Happy Martin Luther King Jr. Day to everyone in the US, by the way!

But why should I have to wait until Monday when we have a better system and it’s my money? Shouldn’t I be able to transfer and do what I please with it between accounts that I own, even if I’m paying someone to keep it safe? After all, the online banking system’s ledger is almost entirely systematic anyway.

When you agree to a bank’s terms and conditions and accept an interest rate on your deposit, you are entrusting your money to the bank with the expectation that it will be returned to you when you request it. It is important to note that the bank uses these deposits to invest and lend to other customers, and therefore they need to have enough cash on hand to meet the demand for withdrawals. In essence, by depositing your money with a bank, you are transferring ownership of the funds (excluding any insured amounts).

Digital Currency

If this were a digital asset, such as Bitcoin or one of many others (it doesn’t necessarily have to be a cryptocurrency to be a digital currency), which I attempted to transfer on a Sunday, I would have already received it before I started writing this article. After realizing how long I had to wait for my transfer to go through, I decided to write this article. To further illustrate my point, it took me only three minutes and twenty-six seconds (yes, I timed it) to transfer $9,500 from the US to Spain, where I currently reside, through my various crypto accounts. However, I will have to wait over 50 hours for the banks to process a transfer of $200 to get it to and from the same place (US to Spain).

While the fees for certain crypto transactions could be lower, they clearly have a better system. A system that does not allow banks and the Fed to play casino with our money. A system that is more efficient. A system that has fixed double-spending issues, for the most part. A system that gives loans to hard-working people instead of hoarding it with established companies and corporations. This is not how economies grow; this is how they die.

If banks decided to operate on weekends or holidays regarding online transfers of what is already digital assets, I would be pleasantly surprised. But I would also have received something that should have been implemented years ago.

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When did our society begin hindering growth in the areas in which we innovate?

Fortunately, in our existing banking system, we have companies like Wise that are already innovating alongside our existing system. They are amazing, and I use them all the time to transfer money abroad.

Speaking of which, with more migration happening around the world, more people are sending money to their families back home, in other countries, and more people are traveling and living abroad while globalization continues. Where do you see the future of money heading? Currently, banks do not even allow people to sign up for an account, even if they have money. Most of the world is underdeveloped, and the little money that circulates in these areas is accumulated almost entirely by the banks, who are not willing to allow those with money a safe place to store it.

Innovation outside regulation

Most banks in developing countries give priority to the wealthy when it comes to opening bank accounts. It’s only after a country has reached a certain level of development that lower-income citizens are considered for account opening. However, anyone can sign up for a crypto account today and easily send money without the need for a bank, thanks to innovative blockchain technology that ensures secure monitoring of transactions.

There’s a more equitable way to exchange money, and unfortunately, some elected officials are trying to stifle this innovation without even understanding it. While certain concerns raised by critics of crypto should be taken seriously, others are simply baseless propaganda. Governments and banks, we urge you to step aside and allow us to address the injustices of the past centuries. You may return once you’ve had a chance to reflect, but with our unimpeded technology, it’s possible that we won’t need you anymore, as we will have given everyone the luxury of protected and insured money.