Most bankers I know are users of cryptocurrencies and are pro-crypto, but the banks they work with are completely against cryptocurrencies. Well, I think the reason for this isn't far fetched. For one, I think banks which are considered to be conventional financial establishments recognized by the government tend to consider crypto as a threat to their existence.
They're not entirely wrong though, especially since people won't need them to store their currencies, get loans, save and carry other financial services. But I believe it's better to become friends with the threat to learn and understand its ways than to keep building unnecessary hostility and animosity.
However, banks in every country are centralized and controlled by the Central Bank which in turn is controlled by the government. It's unfortunate that the government of most countries aren't pro-crypto and have created so many bans and restrictions on crypto. For example in my country, banks have to obey the anti-crypto orders by the Central Bank so they can remain in business. Those who have failed to comply have been heavily sanctioned and it kinda serves as a lesson to others.
Banks as we know are one of cryptos arch-enemies but could that change in the future? I mean with the massive adoption of crypto around the world and the fact that even bankers seem to be more involved in crytos than people from other other professions. I think the answer lies with the government. Banks really can't do anything that's not acceptable by the government of a state and so they're kind of handicapped in decision making particularly those involved with cryptos.
What may happen however is that the government of most countries would accept that cryptos are a part of our lives and they'll try to adopt and regulate its use in ways that cryptos wouldn't be much of a threat. This may time alot of time to happen particularly in countries that depend heavily on printing bills .
After talking to a couple of my friends who are bankers and are involved with cryptos , I think most banks really wanna adopt cryptos but the big guys at the top don't want that.
Governments and banks seem to desire to have absolute control over citizens lives and total data about how they earn and spend their money.
But for the banks, there is another, simpler issue. Liquidity. The banks earnings are based around the wonders of fractional reserve banking, cycling money around and around, each time producing more out of thin air to lend at exorbitant interest rates. But they need the liquidity of those initial deposits to kick-start the whole crooked game. If consumers are investing in crypto, they aren't giving the banks the funds to create that initial liquidity.
There are a number of factors that could be contributing to their opposition. Banks are not necessarily anti-cryptocurrency, but there are concerns associated with them. In the case of India, the Reserve Bank of India said that private cryptocurrencies pose a significant risk to financial stability. The Reserve Bank also highlighted the threat that such digital assets pose to anti-money laundering efforts and capital flow. Below are six reasons why banks are not fond of cryptocurrencies.
The most important issue is the perceived use of cryptos as a means of payment. The use of cryptos has raised concerns about tax evasion, illegal activities, and the black economy. Cryptocurrencies may also be used to finance criminal activities, which is why tax authorities are increasingly monitoring transactions conducted through digital currency exchanges. In light of these concerns, some banks are attempting to regulate the industry.
In response to the rise of cryptocurrencies, the banking industry has been racing to catch up with the technology. Some banks are starting to offer cryptocurrency investments to wealthy clients and are even weighing the idea of establishing trading desks for Bitcoin and other cryptocurrencies.
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