We need banks because we need money and we also need a way to manage it. But traditional banks don’t always meet everyone’s needs. Bitcoin first showed us what an alternative could look like. Here’s why cryptocurrency financial management is important for the future.
Psychologists often say that humans are set apart from other animals by our ability to make complex plans for the future. That’s a big reason we use banks; to prepare for whatever lies ahead in our lives. The option to save or borrow let’s us buy houses, start businesses, get an education, plan for emergencies and so on. It’s an important safeguard, a way of ensuring our world remain stable. We need banks because we need money and we also need a way to manage it.
But traditional banks don’t always meet everyone’s needs. There are a lot of issues with them, in particular with accessibility. An estimated two billion people live without access to a bank account. Many live in politically unstable or conflict torn areas, many can’t afford bank fees, many can’t get to a branch. Around 20% of people are ‘underbanked’ and go elsewhere for some services. Banks often take days to make a transfer and take a large cut in the process. Bailouts, security breaches and controversial salaries have further contributed to the widespread sense we need a new system.
Cryptocurrencies first showed us what an alternative could look like and introduced the world to blockchain technology.
The problem is that we haven’t had a secure, all in one platform for managing crypto. Investors need to use a few different services at once. It takes a lot of effort to ensure everything is secure and in the right place. To spend crypto in the same way as fiat is also not as simple as it could be. You need to either use a prepaid debit card or find a merchant who accepts it.
This is why all in one financial management platforms are vital for the future. Wirex is building an innovative banking platform for managing your crypto in one place. Security is the priority, which is why we’re proud to say that Wirex is PCI DSS certified. This means your payment information is protected to the highest industry standard. We are also working with SBI Investments (a leading VC firm) to create a secure platform and a community.
What’s the point of a cryptocurrency bank account?
- For trading or short-term investing. At the moment, investors need to use multiple tools, meaning multiple points of failure. With a crypto bank account, everything is in one place. You can also use a real (not prepaid) debit card for day to day purchases, even at places which don’t accept crypto.
- For long-term investing. Some investors are now viewing digital currencies as long-term assets. When your timescale for an investment is years or decades, you don’t want to worry about it during that time. A bank account is perfect for HODLING with minimal effort.
- As a backup in case of a financial disaster. Cryptocurrencies are popular in countries with a history of hyperinflation, such as Zimbabwe and Venezuela. Cryptocurrencies are volatile at the moment, but they are nothing compared to hyperinflation. Elsewhere, some investors hold crypto in case of recession, or the collapse of the US dollar or gold.
- To access financial services in areas without banks. Cryptocurrencies can help fight financial inequality, bringing banking to anyone with internet access. And we’re close to having the technology to provide everyone with high-speed internet.
Bitcoin has come full circle, going from a means of eliminating banks to a means of improving them. Combining blockchain technology with financial services will make them faster, cheaper, more accessible and more secure.