The banking system is flawed by design. This first sentence may seem brutal to start an article, but to convince you that it is not the case, I suggest you look at this image: This image comes from the “ ” which lists all the penalties received by banks worldwide since 2000. Violation Tracker Industry Summary Page As you can see, in the first ten places, you will find names of banks you know well: Bank of America, JPMorgan, Wells Fargo, Citigroup, and Goldman Sachs, ... None of them are missing! The banks have thus received a cumulative amount of fines of more than $347B since 2000. This figure is already huge, but be aware that it is only the tip of the iceberg. For every scandal that breaks out in the banking world, how many fall under the radar? Many more! The problem with the current banking system is its opacity and the feeling of impunity that private bankers have. They know that in 99% of the scandals, they will get away with dropping large checks that will not even come out of their pockets anyway. The system is designed that way, and they take advantage of its (known) flaws. More than the actors, it is the system itself that we need to question. The worst thing is that nobody will try to fix this system. In any case, it is impossible because the problem is linked to its design. The opacity of the current system allows the worst sides of humans to express themselves: greed and giving in to corruption. The collapse of SVB in March 2023 will have brought the flaws of the current system to the forefront once again. The subsequent Credit Suisse collapse in Europe will have shown that the problem is global. Nevertheless, you frequently see central bankers and private bankers meeting at conferences to talk about the future of banking. They come to boast about being ahead of the curve on digital, working on Blockchain (you know, the famous “Blockchain, Not Bitcoin”), or being exemplary in control. All this is just smoke and mirrors, but the problem is that a majority of the general public continues to blindly believe what the powerful people at the head of the current monetary and financial system say. In my opinion, the future of banking is not on the side of private banks but rather on the side of Bitcoin with the possibility to be your own bank. So, I'm going to tell you the reasons why I'm convinced that the future of banking has no banks. Just Bitcoin that is accessible without permission to as many people as possible. 1. Corruption The current banking system requires that you have blind trust in banks. However, if there is one thing that the banks have demonstrated to us for several decades, it is that they do not deserve the blind trust that the current system requires. The picture showing the cumulative amount of penalties received by banks since 2000 is enough to make you realize that the current system allows bankers to give free rein to the natural human penchant for corruption. When you look at the reasons for these penalties against banks, you see that their bad behavior seems limitless: mortgage abuses, toxic securities abuses, investor protection violations, economic sanction violations, consumer protection violations, fraud, banking violations, Foreign Corrupt Practices Act, anti-money-laundering deficiencies, price-fixing or anti-competitive practices, False Claims Act and related, tax violations, ... The question is: how long will the majority of the general public tolerate these actions by the so-called Banksters? 2. Fractional Reserve Banking Until the COVID pandemic in 2020, few in the general public had heard of Fractional Reserve Banking. Many thought it was a technical banker's term. Not something that was of interest to them. Yet, it is essential to understand what Fractional Reserve Banking is because it is at the heart of today's banking system. Fractional Reserve Banking describes a system in which banks can lend out a certain amount of the deposits they have on their balance sheets. Banks used to be required to hold a certain amount of the cash that depositors placed in their accounts in reserve. But since the COVID pandemic, the Fed has decided to eliminate the reserve requirements for all depository institutions: To help you better understand why this system is problematic when depositors lose confidence in the system, here is an example. A U.S. bank has 10 customers with $2,000 each in savings. According to Fed rules, the US bank in question can use 100% of the deposits for loans. The available capital is $20,000. The bank decides to borrow 100% of the funds from these 10 accounts, which is $20,000. The balance shown to the depositors is still $2,000. For them, the operation is transparent as long as they do not try to withdraw their money at the same time... The bank has just created $20,000 that it will lend to one or more borrowers. The depositors may (or may not) receive interest payments on their $2,000. The bank will collect interest at a higher rate from the borrower to pay for your interest and service. Proponents of this system will tell you that it will stimulate the economy or that banks do not need to hold huge amounts of capital or that it makes regulation easier. However, ask yourself what will happen if all the depositors want to withdraw their deposits at the same time. Well, you will see the same bank run as the one in mid-March 2023 with the SVB bank. A bank run that will undoubtedly lead to the collapse of the bank unless the Fed saves it or the current administration in Washington decides to change the rules to save the system. The problem is that each time, this requires printing more and more fiat money out of thin air to save and protect the system as Janet Yellen so aptly put it. And each time, this pushes the problems of the current system to a later date, but with an even worse magnitude. This system is not sustainable forever. As far as bank runs are concerned, many thought that they could only happen in emerging countries like Argentina, Lebanon, Venezuela, or Zimbabwe. But the last few years have proven otherwise. You could see such bank runs in the early 2010s in Europe in Greece or Cyprus. And more recently in California in the United States ... 3. An Opaque System Have you ever wondered why the current system is so complex? Probably so that no one from the general public can understand how it works, otherwise a revolution would probably break out tomorrow, as Henry Ford said a century ago: “It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.” Where we go around in circles is that an opaque system favors corruption. The current banking system is therefore a real vicious circle favoring bad behavior. It requires absolute trust with no way of checking but the past has already taught us that this is impossible. 4. Deposits Are Not 100% Covered When a bank like SVB collapses, all depositors are at risk of losing money beyond the bank deposit coverage limit. In America, the FDIC sets this amount at $250K. In Europe, the amount is €100K. What happens if you made the mistake of saving the fruits of your labor in a bank account beyond these guaranteed limits? Well, you can lose everything! Unless of course, as in the case of SVB, the government stands behind you. But be aware that this exceptional case is not the norm, because currently, US Commercial Banks Deposits is at a current level of $17.30T: You can see that in the case of a generalized bank run on all American banks, the situation would be explosive. Many would lose a lot of money unless the Fed decides to explode the M2 Money Supply and inflation as well! This situation is profoundly unfair, and it would be necessary to create banks that can guarantee 100% of the savers' funds. But obviously, this will not be done. The fruit of your labor will never be 100% safe within the current banking system if it exceeds the coverage limits defined by the regulators. 5. Privacy and Censorship Issues You work hard for a living. You earn money that you then want to save in the bank. In some jurisdictions, such as the Eurozone, you are obliged to save in a bank, as there are limits to how much money you can keep in cash at home. In France, for example, this limit is €10K. If you have more than this amount in cash at home, it's illegal. Yet, you have earned your money honestly by working hard within the current system. But these are their rules. You have to follow them or you are outlawed! Sooner or later, you risk having more than €10K in your bank account. And then you want to make a transaction with a third party for an amount of several thousand dollars or euros. It's your money, you should be able to do it without having to justify yourself and without the risk of censorship. Unfortunately, within the current system, this is impossible. To comply with their famous anti-money laundering practices, you will have to explain why you are sending this amount to a third party. You don't want to disclose it because of your privacy? You have a good chance of having your transaction censored. However, there is no money laundering, since your salary is paid every month into his bank account. The bank knows where the money comes from. But that's the way it is. This is unacceptable, and it will not be accepted forever with the new generations who will look for other solutions more respectful of their rights. 6. SWIFT: A Slow Cross-Border Interbank Payment System at the Mercy of the Americans In addition to point 5, imagine now that you want to make this transaction internationally. Chances are that you will have to use SWIFT, the interbank payment system used by banks. No matter what they say, it is a system dominated by Americans. We have seen how easy it was for the Americans to cut off the access to SWIFT to Russian banks from the very beginning of the war in Ukraine. Whatever your opinion on this war, it is not normal that one country reserves the right to control the whole financial system as America has done for decades. America is abusing the privilege of issuing the world's reserve currency. In addition to this problem of censorship at the state level, SWIFT is proving to be a slow, expensive, and inefficient system. Transaction fees depend on the amount sent, whereas in all cases, the figures are stored in the same way at the computer level! Abominable delays of 2 to 5 working days. If you have an emergency, don't count on a bank to help you! 7. Fees Banks take advantage of their positions to charge their customers exorbitant fees. The smallest service is charged an insane amount when you think about it. I'm not even talking about the abusive fees that some banks will charge to their most troubled customers when they are overdrawn. International remittance companies are also taking advantage of the inefficiency of the current system. To allow fast international transfers and thus compensate for the lack of SWIFT, Western Union or MoneyGram will charge their users crazy fees. No wonder these companies were against the introduction of a standard Bitcoin in El Salvador, allowing thousands of members of the Salvadoran diaspora to send money to their families back home via the Bitcoin network at a lower cost. Because Bitcoin changes the game here by decoupling the fees paid by customers from the amount transferred. After all, no matter how much money is transferred, it's only digital data that is transferred. There is no reason to charge someone who transfers $1M more than someone who transfers $1. Unless the goal is to take as much money as possible from customers, which is the case with the current banking system. 8. You Need Permission to Use Your Money Point 8 has already appeared in the previous points, but it seems important to write it again to show how unbelievable it is that so many people continue to accept the way the current banking system works. You need the bankers' permission to use your money. You are required to entrust your money to these private banks, and then you are trapped in a system whose arbitrary rules can change at any time. A system in which your money is at the mercy of the rules of others. If you don't want to obey these unfair rules, you may find yourself unbanked. In the world of Bitcoin, there have been several instances where people have had their bank accounts closed for no real reason. Simply because these people were connected to the Bitcoin world via an entrepreneurial activity for example. Something that is unacceptable, and that the people will not be able to accept forever! 9. Your Bank Is Always There for You, but Only During Office Hours To win new customers, banks are going to be full of ideas in terms of marketing by making them believe that they are close to their customers. Close to their customers and available at any time. At any time during office hours, of course ... If you need a particular banking service on a Sunday or holiday, don't count on your bank to be there. You will have to wait for bank business days and business hours. When it's 2023, is it normal for you to settle for such inefficient service? I doubt it. Perhaps you are not looking for better alternatives because you are too used to this inefficient system. You have the impression that no alternative exists. This is wrong. Future generations won't even question it, because they will be born at a time when Bitcoin has become something common and normal to use. Banks will have to adapt to survive. But they cannot do so, and that is why the powerful in the current system are doing everything they can to undermine Bitcoin. When you can't keep up with an opponent, the best thing to do is to try to destroy him. This is the sad philosophy of the powerful people in charge of the current system. 10. No Sovereignty. Your Money, Their Rules, so It’s Their Money. All the points I have just detailed show you something essential. In the current system, you are like a subject who must obey arbitrary rules defined by a minority of people who are not representative of the people. These people are the central bankers who have control over the private banks. In this flawed and not fixable system, you have no sovereignty. It's your money, but their rules, so it's their money. Because the money that belongs to you under certain conditions is not your money. Just a promise. I'm sorry to make you realize this so abruptly, but that's the reality as it is. I have a feeling that the topic of self-sovereignty will only grow in the future. More and more people will open their eyes and want what is rightfully theirs: control over the fruits of their labor. To have the freedom to use the fruits of their labor as they wish at any time. In short, to have freedom over their lives. Bitcoin Is the Answer Because Bitcoin Lets You Be Your Own Bank Now that you have a better understanding of the problem with the banking system, you will want to discover a solution for the future of banking. And this future of banking is bright because it will consist of turning yourself into your own bank. This solution is optimal because you are the person you can trust the most. Of course, this will require some adjustments at first since you will have to take on the security of the fruits of your labor by yourself. But this small adjustment will allow you to have complete freedom over the fruits of your labor. By switching to the Bitcoin system, no one can censor you. No one will be able to stop you from using your money at any time you wish. You'll be able to cross borders at any time at a reduced cost. Bitcoin addresses all the problems with the current banking system. Better yet, with Bitcoin, you can become a banking branch yourself by running your node on the network. You'll enhance the decentralization of the network while having the ability to check everything on the system yourself if you wish. Running a network is open to anyone with no prerequisites. This allows you to audit the system yourself every 10 minutes. It doesn't get much more transparent than the Bitcoin system. You can audit everything both statically (open source code) and dynamically (by connecting your node to the Bitcoin network). With Bitcoin, you get self-sovereignty with monetary rules that are known in advance and do not change. Something essential to preserve your purchasing power over time by having the right to save the fruits of your labor. It is not for nothing that we constantly repeat that Bitcoin is the best savings technology in the world. With Bitcoin, you will be able to make the rules yourself and therefore have access to your money without any preconditions. The real freedom over your money will be yours. In the end, you will even find that you will sooner or later achieve true freedom over your life. That's the path you'll be able to take by embracing the Bitcoin revolution. This is a much brighter future for banking than the one the powerful people at the head of the current system want to sell you. Don't take for granted the word of Bitcoiners who tell you that Bitcoin is an incredible monetary revolution, but verify it for yourself by developing the knowledge to build your truth about Bitcoin. That's what I suggest you do in the book “ .” The Truth About Bitcoin: Everything you need to build your truth about Bitcoin and stop trusting others without verifying The book is available on various platforms: - On Amazon in print format: 630 pages - On Amazon in Kindle format: 543 pages - On Gumroad in PDF format: 475 pages : contact me by email at - In P2P mode in PDF format or EPUB format with payment in BTC (-20% if you buy in Bitcoin) sylvain.saurel@gmail.com Also published here

At the time of publication, the writer was hodling. 

The Future of Banking Will Only Be Bitcoin: Here's Why

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