What Happened To Traditional Banking?
(The unfortunate realities of failing to adapt and evolve with the changing times.)
December 8, 2020
We can send an email to someone living on the other side of the world, and they receive it
within seconds. The same can typically be said of a text message. Bitcoin and other digital
assets can be sent from wallet to wallet, across the same vast distances, almost instantaneously
as well. Yet, wire transferring funds from one bank account to another, within the same country
or even the same state, can take hours and in some cases, days. In a rapidly evolving digital
world, this is problematic and beyond inefficient.

Last week, in an attempt to move funds from one bank account to another just a few states
away, a day long process ensued. First on the list, we had to locate a banking branch which was
not currently under a 14 day mandatory closure due to an employee testing positive for the
“virus”. Both of the local branches were temporarily closed, as has been the case more often
than not over the past 7 months. Upon calling an inconveniently located branch in order to
ensure that they were indeed open for business, a representative advised that all wire transfers
must be initiated in person, and cannot be processed via email, phone or PIN code. A physical
visit was then made to the open branch, where a fairly significant wait was in order, as a result
of short staffing and excess customers. Upon informing the teller that a domestic wire transfer
needed to be sent, she registered with a combination of displeasure and disdain due to the
amount of work that would need to be completed on their end and once again, we were
instructed to wait for an available “specialist” employee who was capable of assisting with this
seemingly outlandish request. After a pretty reasonable period of time, we began the process
of initiating the wire transfer by supplying the appropriate sender/recipient information,
verifying identification, signing documents and paying the excessive wire transfer fee. Within 30
“short” minutes the wire transfer was sent, subject to validation and backroom approval (at
both ends) of course. We would later learn that our funds had arrived safely at their destination
just before the close of business that very same day. This process had begun at 9:00am.

While this experience is not necessarily indicative of every single traditional financial institution
out there, it is just as prevalent now as it was 20+ years ago. It seems that almost no progress
has been made in how we send and receive fiat currencies. Now, traditional banks appear to be
paying the price for their inability, or even unwillingness, to evolve. The advent of Distributed
Ledger Technology (DLT), and more specifically Blockchain Technology, are forever changing the
way we view the banking industry. The rise of Financial Technology (FinTech) companies over
the last several years adds yet another component of competition into the mix, further
highlighting the long-standing inefficiencies, stagnation and significant inequities that exist
within our current financial system. Bitcoin and other digital assets provide all of us with an
opportunity to move away from these outdated, bloated and centralized financial institutions,
and into what will become the future of monetary policy.

In the coming years, we will likely see fewer and fewer physical bank locations. The majority of
traditional banking transactions can now be conducted virtually, whether traditional banks
would like to admit this or not. Safety deposit boxes are becoming a thing of the past, and
investments such as owning physical gold, silver and the like seem less and less practical in a
digital world [Gold is certainly its own topic for another day, and deservingly so]. With the rise
of Central Bank Digital Currencies (CBDCs) on the horizon, and our apparent societal transition
to virtual learning, working, buying and investing, what can be said of the remaining role of
physical bank locations? Does their continued presence really serve our needs,
as our needs exist at this point in time?

We all have an enormous opportunity right at our fingertips, right now. We can participate and
invest in a burgeoning asset class, before the largest and greediest of institutions move in to
massively increase their positions and wealth, and ultimately drive up the price and dominate
the space. Young or old, rich or poor, this side of the world or the other. We are all
interconnected in ways that we would have thought were unimaginable just 20 years ago. The
future is now, and we are preparing to see one of the largest wealth transfers in world history
over the coming decade. Wealth flowing from traditional financial institutions, exiting
traditional investment spaces, and being passed on from the previous generation. Regardless of
what our personal position is relating to the cryptocurrency and digital asset space, one thing
should be abundantly clear; don’t be like the banks.