Cryptocurrency world can be considered as a kind of anti-bank. The world of centralized, profit-driven, and often fraudulent banking is the opposite of crypto.
The outright rejection of centralized structures may help, but the truth is that legacy banking models created spaces where users felt safe, and transactions were often simple and fast as well. consistent with the expected result. Your grandfather likely won’t buy Bitcoin because he finds himself in a completely unfamiliar territory.
Cryptocurrency exchanges, on the other hand, are gaining notoriety for their wildly varying fee structures, financial constraints, and confusing and useless reporting.. The technical aspects of cryptocurrencies make transfers secure, but in some cases slow and tedious.
Lessons from Old Banking
Cryptocurrencies need to learn a few lessons from older banking models in at least three areas. These are: Simplicity, scalability and reporting method.
Simplicity
Having to create accounts and wallets on two to three exchanges to purchase a single coin greatly limits mainstream usage. In addition, uninformed cross-Blockchain trading greatly hinders investment.
Imagine not being able to transfer funds from your savings account to your checking account at your local bank.. To do this you have to withdraw funds and pay a fee and then you have to recompense the funds for an additional fee. This system annoys investors and negatively affects the main application.
Cryptocurrency exchanges need to simplify these operations. Perhaps the simplest exchange, Coinbase, allows users to purchase cryptocurrencies with fiat and has a user-friendly interface, but the purchase fees are high and cross Blockchain transfers are still impossible.
Other exchanges such as Bittrex have tried to simplify the process of buying Bitcoin to help new users join. Kraken also said that she has taken similar steps on her site:
“Kraken is simple, fast and free to use.. After verification, you can transfer funds to your account with the help of Bitcoin or cash and start trading! “
Providing debit cards and other services is a start, but the acquisition itself remains even more complex, and mainstream adoption becomes a challenge for technically inept consumers.
Scalability
Legacy banking methods provide great flexibility for corporate customers. Large-scale transactions are generally well managed, and clients can transfer significant sums of money between accounts or to other institutions.. These limitations are based on the need to comply with anti-money laundering laws.. Also, these limitations are due to the many exchanges that lack liquidity to allow large-scale fiat transactions with cryptocurrencies.. Legolas Exchange CEO Frederic Montagon said:
“The option to convert fiat currencies to cryptocurrencies large is a big deal for society. There will be change”.
Reporting
Wallets and exchanges provide useless and inadequate reports. On the other hand, legacy banking models generate a series of reports that are extremely valuable to users and that cryptocurrency exchanges should come up with.
In order to increase consumer confidence, profit and loss statements from individual transactions, specific profit statements and numerical tax information should be provided to users.
Poor reporting creates difficulties in other areas of customers’ lives as well. Mortgage companies get stuck when they find large Bitcoin-related deposits in customers’ bank accounts. In the absence of proper financial statements on the exchange where the cryptocurrency is sold, obtaining a mortgage in such a situation can be nearly impossible.. Increased alerts about service interruptions and added assistance for inexperienced users will increase user comfort.
Inconvenience
Simplifying processes, expanding financial limitations, and providing more helpful reporting, is what the cryptocurrency exchange community can get from traditional banking.
Join our Telegram channel to be informed about all developments and shares!