The massive popularity of the crypto industry has numbers to back it up. Since its inception, bitcoin has hit a market cap of over $1 billion which blockchain is on its way to hit over $30 Billion. With its rate of adoption, the general market cap is expected to clock $1087.7 billion by 2027. With all these high-income numbers generated over the years, crypto banks have now begun to rise with our traditional banking system undergoing several backlashes.
Recent research has shown that cryptocurrency capital being accumulated will require a structure to monitor the flow and progress of the commodity. This has led to an uprising of cryptocurrency banks which are now becoming more popular than traditional banks so how will traditional banks remain relevant?
Crypto Banks vs Traditional Banks
If you check any platform where the financial market is the topic of discussion, AI, Blockchain and Cryptocurrency are the terms that are most trending on almost all platforms. This is because we’re in a period where we’re facing significant changes and those changes are driven by the crypto industry because the number of transactions daily keep increasing.
Financial experts assume that the compound annual growth rate will hit 12% by 2024. If it does, people would start questioning the motive of cryptocurrency. While we have been using fiat currencies for years, massive use of cryptocurrency will help build the role of technology in our lives. It will expose us to the different obstacles we have been facing with traditional banks in comparison to crypto banks.
Limitations of traditional banks?
The use of cryptocurrency makes investment and transaction process different from anything we’ve been used to over the last decade. After the 2008 global financial crisis, the whole world has seen that the traditional banking system is vulnerable to economic challenges. When those challenges became clear for all to see the need for an alternative way of securing funds became clear which led to the invention of bitcoin.
This bitcoin possessed more advantage over our traditional ways of doing things due to the transaction speed been way lower than normal banks. However, with the growth in popularity of traditional banks, there are certain limitations possessed by traditional banks that put crypto banks at an advantage.
Lack of decentralised technology
One major obstacle faced by traditional banks were their policies, interest rates, and regulations which caused a series of insufficient processes for clients. It’s tiring and that is something the new cryptosystem handles as performing transaction don’t require any physical structure and users can hold their assets anonymously.
In the summer of 2021, the Federal Reserve announced the implementation of digital dollars. Digital dollars are not a form of crypto technology neither will they be decentralized. It is a traditional form of fiat currency in digitized format. The reason for this is because the government decided to give people with little or no access to the banking system a chance to access it.
The reason for this move may be an attempt to remedy the challenges the crypto industry has created for the traditional banking system. Asides from the government, many huge corporations that operate the financial market are also looking for a remedy to the wide gap created by cryptocurrency in the financial sector.
If you’re tired of the traditional banking system and its mode of operations, you can switch over to crypto banking on https://bitcoinrejoin.io/. This is how digital currency is introduced to the market to be transacted or exchanged. People create crypto platforms where you can transact or hold valuable assets as a user. Crypto banks are just another way of referring to the apps the platforms create online to perform these services.
The future is bright for cryptocurrency especially as more people get to accept it and the government also approves of its use globally. There are still certain security challenges ahead that the crypto industry in collaboration with blockchain will overcome when they both collaborate in the future.