Quote from: iluvpie60 on June 19, 2014, 03:56:00 PM

Quote from: Este Nuno on June 19, 2014, 03:53:13 PM

Quote from: cuddaloreappu on June 19, 2014, 03:30:46 PM

As we move into bitcoin economy , where there is merchant adoption universally and you are able to buy anything with bitcoin, there is no point an average guy would put his savings in a bank, He could save even a million dollars worth of money in a encrypted paper wallet.

Now banks will lose all the minimum balance that it recommends for having an account, Now banks will not have any money to loan out and hence the entire banking system collapses.

On the other side bitcoin 2.0 applications like counterparty, ethereum will enable crowdfunding and other financial derivatives and decentralized exchanges which will affect the investment banks. Because you don't rely on a central institution like banks to raise your capital.

What other ways could banks face disruption by bitcoin?

What if banks offered competitive interest rates on deposited fiat?

in the U.S. you get like .1% per year on whatever you have in your bank account. Lets say you have 100,000 USD in the bank, that is 100 dollars you make by leaving your 100,000 in the bank... Or you could buy a stock and sell it for a .2% profit in less than a matter of a day and make 200 dollars - a 10 dollar trade fee? or you could do the same thing with converting BTC/USD and whatever else, my point is that you definitely do not make yourself better off by leaving your money sitting around. Smart money makes money.

Yeah, the interest rates are bad now because there is very little pressure on banks to offer any. But with Bitcoin as a direct competitor as a store of value they might have to lower their margins and offer better incentives.

A high interest rate, stability, and security might make a bank account a reasonable place to hold at least some of your wealth.