The main problem with the banking and financial system is that it takes a lot of time for money and other securities to be transferred. The reason for this is because there are so many players involved. If you're buying shares of a company from a broker (eToro for example), the broker will normally use a custodian bank to hold the stocks for you, the custodian bank (for example, Bank of New York Mellon $$BK or JPMorgan Chase $JPM ) in turn will buy these shares from a market maker (for example, Goldman Sachs $GS ) and the market maker will bid for the shares on the NYSE. The whole process normally takes 2 days to settle. It is important that this system is secure, liquid, and legal. Since nobody wants to take all the risks, many players have to be involved. All of this makes it time-consuming.
How do we simplify the banking system? By making use of Blockchain. Bitcoin $BTC sounds like a good alternative. Bitcoin is not a currency as it is too volatile and is most likely a store of value like gold $GOLD although recently Nassim Nicholas Taleb wrote a paper on why Bitcoin cannot be compared to gold because of its dependence on miners. Bitcoin and other cryptocurrencies also face problems from regulators which can ban them at any time.
What if the Banks built their own Blockchain? This is already being done, for example, JPMorgan Chase builds JPMCoin to handle part of its $6 Trillion daily transactions. Goldman Sachs is also using JPMCoin for repo transactions. This is a little similar to when Bank of America created Visa $V which was then adopted by other banks and is now the largest credit card network.
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