2 Reasons Why You Should Want Blockchain Tech To Replace Banks ASAP

2018 is a riot.

A few years ago, you had to go outside to get food. Now you can use an app.

Want Burger King at four in the morning? You got it. Uber means I’m no longer calling up a cab company; I’m just hitting a button on my phone.

Amazon means I’m clicking one button and getting anything delivered. And Tinder…well I’ll leave that to your discretion.

Tech makes our lives easy. Which begs the question, what’s happening next?

That’s simple; it’s blockchain, and today I’ll give you two solid reasons to why financial institutions should start worrying.

Grab a delicious beverage of choice (I like mango cider), get comfortable and let’s jump in.

Reason #1: More Money In Your Pocket

I could leave it there but let’s elaborate (and tell you how much you’re saving).

Let’s say you moved to another country to work and need to send money back home to your parents, how would you do it?

Well, Western Union is king for international money transfer. The feecan be anywhere from $0 — $95 for transfers of up to USD $1,000.

That’s pricey, can we find an alternative?

Let’s try your bank, here’s a comparison of all the different transfer rates from major banks across the United States. The fees average to around $35, with Fidelity being the outlier at $10 but adding 3% to the price. A bit better but still expensive.

Can blockchain make this less painful?

Well, the ‘fee’ structure for blockchain tech works very differently, so bear with me. Rather than a set or percentage fee, a bidding system is used. The higher you bid (this is voluntary), the more likely your transaction will be chosen next to process.

For example, right now the average fee on a transaction is $0.1122, and this guarantees your transaction within 5–15 minutes. If you want to want your deal to have priority, pay a bit more than the others.

You get a level of control financial institutions can’t provide while only paying a fraction of the price.

Reason #2: Financial Institutions Have A Ton Of Your Data….And It’s Not Safe

If you’re angry about the Facebook Cambridge Analytica Fiasco, you haven’t seen anything yet. Do you remember the last time Facebook asked you for your SSN number? I don’t either.

But I sure do remember giving it to my bank when I got my first part-time job at the tender age of nineteen. I needed a bank account to buy essential things (like video games and ice cream), so I didn’t have much of choice, no one does.

While a breach of my name and email address could cause concern, my SSN getting leaked would straight-up give me a heart attack. Even big banks aren’t impenetrable, take a look at this timeline, you’ll see some familiar faces like JP Morgan.

But wait, banks have been around for a while and blockchain hasn’t. Wouldn’t that make banks the safer bet? Turns out that’s not the case as blockchain, by nature, is insanely secure:

• Blockchains, as implied in the name, consist of ‘blocks.’ One block stores data from the previous block and so on. To change one block, you’ll need to change every single block before it.
• The entire system is decentralized; you don’t keep the data in one computer but across every computer in the network. To change the information you’ll need to change it in all the machines, which would require substantial computing power.

So Why Hasn’t Everyone Started Using Blockchain?

I want to share a story with you.

It’s about my dad who’s recently started using Amazon and is in love with it; he might be going broke. But three years ago, he criticized me for being ‘naive’ enough to put my credit card information online. He thought I was setting myself up to get hacked.

I asked him what was different. He merely said, ‘I saw my friends use it, I saw you use it, and I tried it, and it just made it seem like a normal thing to do.’

If you take a look at this graph, that’s the exact trend we’re seeing. As time goes by, the tech becomes more and more ‘normal’ and people start adopting it.

The technology is what starts the innovation, but its companies and individuals themselves that execute and disrupt the environment. Buying online was made ‘cool’ by Amazon and eBay. Ridesharing was made a ‘thing’ by Uber and Lyft.

With that being said, do I think there’s already a company out there that can disrupt the current financial climate? Maybe. Is there a chance for a company like that popping up in the future? Without a shadow of a doubt.

We’ll have to wait and see, so let’s grab some popcorn and watch this exciting time that is our lives right now.

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Written by: Saad Zaeem