In 2015 we saw numerous banks turning to blockchain the underlining technology of bitcoin to drive customer base away from btc and improve their own system in the process. An example was laid out where it was stated that Bank Of America alone uses more electricity then the entire bitcoin network combined. It was popular believe that the “beauty of bitcoin lies in blockchain”, I for one was sold on this. But the more you understand bitcoin the more you realize thats not the case, and the more you fall in love with the whole concept of bitcoin.
Many might disagree with me on this statement. While I am not saying that blockchain and bitcoin are revolutionary, all I am saying is that its not just the tech that makes bitcoin or btc special, its the underlining principle of the bitcoin that makes it the most disruptive tech in the fintech space.
The idea as purposed by satoshi nakamoto was loosely based on on torrent software where you would share your bitcoin via peer to peer system where you would not require central auditing or confirming authority. Now lets think about this for a minute. Decentralization and the open source nature of bitcoin is what make it so special. An example is the recent development disagreement by the core developers where 2 developers purposed a fork of bitcoin XT. That saw the prices of bitcoin plunge to lows of around $150. While many thought that proposal was destroying bitcoin, I believed it was making btc stronger by displaying that no one has control over bitcoin. In the end it will be the people who will decide what is good for the network and not any one entity.
The banking sector was of the belief that its the blockchain tech that drives bitcoin, and without understanding the true nature of why decentralization is important they jumped on the blockchain wagon releasing their own chains and coins in the process. I think bitcoin and banks can live in harmony, how you may ask is very hard to answer. For one I think banks can use bitcoin as a settlement product within their networks. Think of bitcoin as Mastercard or Visacard. When the concept was brought forward banks went a head started incorporating these into their systems rather then coming up with their own individual cards. There is alot to cover of how btc and bank can live in peace then this one article, but the idea can be be implemented in ways that banks haven’t imagined yet. I think time will only improve our understanding of what bitcoin is and how it will shape the future of fintech.