I started to think about it. How a bank and folks could issue loans to people?
Currently, when you need to borrow money, your banker just edits your balance account and create money magically. You then pay back monthly.
Banks won't be able to do that with Bitcoin with its limited supply. You can't print bitcoins.
But now, between folks. Let's say I'm the banker and you're the customer looking to borrow money to buy a house. I can lend you the money but how to be sure you will pay me back with full interests? With banks, the solution is easy, the bank seizes the house and you can't do something. But the average Joe hasn't the same 'power' than a bank to collect a debt.
Currently, when you need to borrow money, your banker just edits your balance account and create money magically. You then pay back monthly.
Banks won't be able to do that with Bitcoin with its limited supply. You can't print bitcoins.
But now, between folks. Let's say I'm the banker and you're the customer looking to borrow money to buy a house. I can lend you the money but how to be sure you will pay me back with full interests? With banks, the solution is easy, the bank seizes the house and you can't do something. But the average Joe hasn't the same 'power' than a bank to collect a debt.
Its just like lending someone cash no different. You either get it back or you don't then you have to legally deal with it. Bitcoin is no different. I dont think banks will get into lending bitcoin because lime you said they would have to have 100% coverage meaning they cant just loan bitcoin magically...but they can lend their own coin
If that is the case, it will be difficult for those who borrow bitcoin in countries that have not legalized bitcoin. Lending and borrowing conventional cash money has been accepted by everyone and every country has prepared related regulations. But bitcoin is a little different because not all countries recognize it. How?