Crypto Banking’s Next Chapter | Web3 Daily

TL;DR

• Banking in crypto has been having a tough time of late; but what better time to discuss the response – specifically related to banking – that the crypto community has had?

• Brent Xu, CEO of cross-chain decentralized finance (DeFi) protocol Umee, says that there is no better time for the adoption of on-chain banking than now.

• Translation: bring the banking system onto the blockchain and everything will work smoother.

• An immutable ledger of transactions, proof of reserves, and transparency about the investments made, all of which is publicly available in real time sounds great.

• In practice, over 6B people in the world have bank accounts. It’s going to take a while to get there.

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It’s no secret – banking in crypto has been having a tough time of late.

But what better time to discuss the response – specifically related to banking – that the crypto community has had?

Kraken kicked things off on March 6 when they Tweeted that the ‘Kraken Bank’ is on its way.

Then, on March 12, Coinbase CEO, Brian Armstrong, Tweeted that Coinbase is also considering launching their own bank.

Now, Brent Xu, CEO of cross-chain decentralized finance (DeFi) protocol Umee, has chimed in saying that there is no better time for the adoption of on-chain banking than now.

“Future banking should become on-chain. That means that banks are going to start to more resemble blockchains as opposed to purely centralized entities.” Xu said.

“[Such technology will allow the banks to have] on-chain metrics related to their exposure to AFS (available for sale) securities like treasuries and to allow better on-chain metrics for their cash management activities,” he added.

Translation: bring the banking system onto the blockchain and everything will work smoother.

So is Xu onto something here? Or is he taking crazy pills?

Maybe a bit of both.

In theory, on-chain banking makes a helluva lot of sense!

An immutable ledger of transactions, proof of reserves, and transparency about the investments made, all of which is publicly available in real time.

Sounds great!

In practice, over 6B people in the world have bank accounts. And that’s not including all of the companies, or individuals with multiple accounts.

The idea of on-chain banking has legs, but it’s gonna take a while to get there!