For me – The interesting part is where the banks fit in. A mate advises JPMorgan and others. We got talking as he is ex IBM with 50 years service. Setting the scene, not bragging.
Keith has solved the time delay in video / audio communications. You know where they cross to the reporter and there is a time lag?
So – video ATM’s (which he invented with this technology) will replace most bank activities and many branches. (on a side note, another mate has invented software for a ‘person-less’ petrol station that is already in action very successfully in small communities. Think petrol ATM)
I reckon banks will offer franchises to avoid the costs. NZ and Australia both use Post Offices for a lot of things like bill paying already. Mortgages are already handled by mobile managers. So why keep expensive premises? (Smart move would be to bundle all banks under one roof – like shops sell different brands).
. The banks still use XP for ATM machines and OS2Warp in places.
. They can’t upgrade because everything is interlinked and they can’t close to test.
. Too complicated to replicate and create a test version.
. SWIFT is used by every bank in the World to move money (China and Russia have a ‘spare’ version of their own – just in case)
. In may 2016 and 2017, the SWIFT system got hacked for 171m and 81m (They came ‘this close’ to succeeding)
. The heists were not an isolated incident, said SWIFT
. Dec 12, 2016 – “Banks using the SWIFT network, which include both central banks and commercial banks, have been hit with a “meaningful” number of attacks – about a fifth of them resulting in stolen funds” – SWIFT statement.
. Hackers are winning 20% of the time – SO FAR, and getting better.
So………..The banks are going to lose to hackers within a few years (Maybe this year – Causing the Black Swan event that crashes the market booms in everything caused by low interest rates they can’t raise for fear of defaults).
‘We’ are in a worse position than when the GFC hit. Banks know Govt will bail them out. Govt. knows it can’t – Stalemate. That’s why we have bail-in laws now, so YOU are GUARANTEED to lose 50% when it goes boom.
So – Crypto is the answer – but it is getting hacked too. The Govt. can’t figure out how to grab it’s share and the banks can’t figure out how to take a % on the way through.
Think of the logistics – Buy a loaf of bread with Ethereum, get dogecoin and ripple for change?
‘Money’ needs to be :
– A store of value
– A medium of exchange
– A unit of account.
Crypto fails on some of those grounds and the volatility works against it becoming ‘Money’ for the time being. Not to mention getting society and large organisations to change (and how? – How do you rework MYOB to handle 1400 cryptocoin types? How do you deploy those new versions worldwide when some places take some coins and not others? Did we mention one wallet per coin? (1400 wallets per business) How do you rework the welfare system or the Forex markets if you remove ‘Money’ as we know it?). Just the introduction of GST caused massive work for many businesses. I printed millions upon millions of stickers for repricing goods in 360+ stores. The programmers toiled months to ‘add-in’ another tax to the accounting system (tax on buy, refunded, then repaid on sale)
Interesting times ahead.