Out with the banks in ten years?

Here, we teaches that Sarkozy summoned the creditors of the UMP, heavy loss, and he laid them an ultimatum: either the party reimburses only from 2017, or he puts the key under the door. Surprisingly, the bankers have not laughed.

And even if we do not yet know their response, namely studying such a market speaks volumes about the one that really has the hand here. Indeed, the terms of this market enough leave little room for maneuver or compromise as Sarkozy proposes, or will take a dead loss and, especially, following a resounding failure of the UMP, to put back to all right-wing politicians in the country. Which, when held the four major banks in France, means certainly a painful future slightest comeback of these elected.

If I speak to you today in this almost amusing anecdote is to illustrate the obvious often forgotten: banks are, nowadays, the typical epitome of crony capitalism. In other words, banks or state, it is the latter who has the last word. The central bank independence is an illusion: all decisions are eminently political, and are taken with the full understanding of the country leaders. Moreover, few elected politicians have found themselves ruined, while it is common that ruined bank come beg for help from the state. It is not a coincidence.

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Faced with this table full of very nasty surprises (from inflation through the negative interest rates, war against undeclared cash, the open struggle against gold as standard and systematic planing savings ), every citizen anxious to preserve its capital protected state can claw granting great importance to any reduction, however small, of the state’s nuisance value in banking.

And it’s good, a profound change began, slowly but surely, in place that will allow precisely to free the citizens of the state ferrule in the banking world. This paradigm shift has its source in the current digital revolution. The latter modifies profoundly essential, the way we organize ourselves to conduct our business, connect with others, whether friendly or business, especially because it gave a growing number of individuals the opportunity to come together, to ideas and information to spread more quickly and efficiently.

This revolution has already pushed more or less violently whole swathes of industry to obsolescence. The banking sector will not escape either, and this, especially since the banks operate globally according to the same principles as when they were born at the end of the Middle Ages in Italy, and they have not evolved in technicality and not in kind. Of course, they all have a nice website, some online banking, and trading platforms work across the millisecond. But this is a mere transposition of electronic processes that are practiced previously manually, on paper, by mail, by auction …

Ultimately, the heart of banks still beats to the rhythm of centuries past, they are always the same institutions that take depositors’ money, make loans and investments more or less judicious keeping safety margins increasingly fine and end up whining in the skirts of the State when everything starts lollipop.

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But today, thanks to the digital revolution, each of the functions that a bank currently serving can be done faster, more efficiently and without central intermediate using digital technologies.

The transfer of money has nowadays need a central bank . Applications like Abra or for monetary exchange currency, Transferwise , provide answers to complex problems elegantly, simple and decentralized, in direct competition with the moneychangers and banking equivalent, although more expensive. And the banks will not provide an equivalent service without changing profoundly business.

account management Typical services are, too, will evolve well beyond the “home-bankings’ offered by incumbent banks. Mint is a fairly obvious example that aims to bring together at a single point all accounts and all banking operations to present them effectively on different media. Similarly, each of the startups presented in article of Capital shows a way to move from traditional bank or to circumvent services.

But more importantly, the cryptomonnaies, Bitcoin in mind, represent the fundamental revolution that give all the building blocks needed to restore full issue of the concept of banking. Bitcoin, already mentioned many times in these columns, needs no centralized point that would be a bank. In addition, where any monetary exchange currently requires a trusted third party (played by the banking system in the overwhelming majority of cases), Bitcoin offers a system operating without trusted third party: transactions are tamper-proof, non-repudiation, and final.

Arguably the volatility Bitcoin courses to see in this technological innovation as a fun gadget and doomed to failure, but the reality is that this cryptocurrency is excellent proof of concept by example: yes, cryptocurrency can operate without a trusted third party or banking system, yes, business transactions can be conducted by using it, and yes, the market may come alone to determine the value and sustainability of the currency without the intervention of a Deus Ex Machina or politicized central bank. Understandably, these characteristics make it particularly sweaty hands of bankers, politicians or even union .

And concretely, Bitcoin has allowed the emergence of a project bubbling in the field, to meet different monetary and banking issues. In addition to more or less serious of cryptomonnaies variants, there are different aggregation initiatives technological bricks (cryptocurrency, payment system, trading platform, …) such as SuperNet platform to sharing in peer-to-peer (without centralization, so).

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As we see, we see the development of increasingly rapid autonomous organizations highly distributed, which are going very well for any permission from a state to perform transactions, and that preventing, controlling or frame will prove impossible (or too expensive), by nature of these innovations. In addition, the carriages have not evolved with faster horses. The graphs have not become electric. Banks as we know them will not evolve into decentralized networks, they will be replaced.

If previous revolutions (for digital cameras up biotechnologies through 3D printing) are a pace indicator of which is to be expected, it is likely it will not take twenty years for such a change . Now, according to a recent report from Goldman Sachs … (a bank, yes) in the surveyed Generation Y (now in their thirties), 33% admit to expect to be able to switch completely from a bank within five to ten years, and 50% believe that any start-up will, by then taken over the last …

When we see that the statesmen have made the current banking system, when we see how much they have corroded the very idea of ​​money and healthy economic behavior, we understand that deprive the state of the banking system and return it to the citizens is a goal both noble and necessary.

And now that the technology is available, it is even achievable.

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