Today I was all set to publish an essay to you about fake news. I was going to explain how the prevalence of 24/7 news has led to a degradation of information.
However, as I was finishing up that essay I got a WhatsApp message from a friend. He pointed me towards some news coming from Australia this morning.
As such that essay you’ll get tomorrow. And instead you’ll get a little gift today.
Yesterday I wrote to my subscribers in Crypto Tech Investor about the problems with banking.
Today I’m going to publish what I wrote to my subscribers, with a few minor edits. I don’t normally do this. Consider this a little gift.
The reason is the news my friend alerted me to this morning was about the Commonwealth Bank (CBA). And as you’ll see from my Crypto Tech Investor update — my problems too were with the CBA. But you’ll know, because you have a bank too, that these are universal bank problems.
According to the ABC this morning:
‘The Commonwealth Bank says it is investigating a disruption that has left some customers unable to make payments and view their accounts online.
‘Customers told ABC News they could not view their accounts via the online banking portal NetBank while others were unable make purchases despite having sufficient funds.
‘People have also reported a number of other issues on social media including being unable to use tap-and-go and the bank’s eftpos tablet, Albert.’
This is exactly one of the reasons why a decentralised crypto based system will be better than the centralised banking systems we rely on today. And as you’ll see from my Crypto Tech Investor essay, it’s not the only problem we face when dealing with banks.
But what you’ll also see is that once crypto can iron out their early teething problems — which they are — we will have a far better world of global banking. Except it will have very little to do with the banking system as we know it today…
The good thing about an [Easter] extra-long weekend is that it gives you a chance to switch off for a brief moment. It’s a chance early on in the year to take a breather and just relax.
It’s easy to relax because over the Easter weekend businesses run on skeleton crew. Shops open under special hours, or not at all. Most of the world goes into partial shutdown over Easter.
And that’s no more evident than in the world of banking and finance.
Good luck if you needed to make any kind of transfer, bill payment, or any financial transaction over the weekend.
Unless you got your banking done by Wednesday, you would have been waiting until Tuesday to get anything done.
For instance I was transferring some money from my CBA account to my UK account. To do this I usually Bpay the funds to CurrencyFair. Then once the funds clear to my CurrencyFair account I exchange AUD for GBP. Then finally I transfer it out from CurrencyFair to my UK account.
It’s three easy and distinct steps. And using CurrencyFair it’s incredibly cheaper and more convenient than using the banks foreign exchange service. Using CurrencyFair — a fintech service that’s still relatively new to the marketplace — is the new way to conduct banking.
Well compared to the traditional banking system, CurrencyFair is a breath of fresh air. However my easy exchange process usually takes two and a half days. I can Bpay AUD on a Monday morning (UK time). It clears to CurrencyFair Wednesday afternoon and then gets exchanged and sent to my UK account almost immediately.
On the Aussie end the process is slow. The exchange and then transfer into UK account, quick. That’s thanks to faster British payments. Apparently Australia is speeding up the process too. Even still, it’ll take me two days to get money from one country to another at peak speeds.
Unless of course something like Easter rolls around. [Christmas and New Years are equally as bad. Or any long weekend for that matter. Or heck…any weekend.]
I Bpayed some money on Thursday from the CBA to my CurrencyFair account. Note: CurrencyFair has an Aussie account in Australia for this. However, my money didn’t clear to my CurrencyFair account until…Tuesday afternoon UK time [Wednesday Aussie time].
That’s right. Sent on a Thursday. Cleared on a Tuesday [technically a Wednesday]. All because of a long weekend for a religion that only one-third of the world actually recognises.
Lucky I didn’t need the money urgently, or I’d have been stuffed.
What I should have done is buy [crypto] like Ethereum (ETH) with my money and then send it to my wallet, and then sell it back to GBP. That process would have taken me around 10 minutes.
There are a few reasons why I didn’t do that, however. And it’s these problems that are why crypto hasn’t quite yet completely taken the financial world by storm.
The first problem is that to get my AUD to ETH I would have to use an exchange. They typically take a fee and a spread. Let’s say I was transferring $100. Almost right off the bat I’d be getting only $95 in ETH.
Then I could send my ETH to my personal wallet. Easy. That takes seconds, not days. And yes there’s a network fee. But depending on the rate, that could be as little as a few cents. Let’s say 10 cents (which is what it’s cost before — for much larger sums, I might add).
But then I’ve got $94.90 left. And then I need to sell my ETH into GBP, to use at the corner shop to buy some chocolate eggs and wine. But the same problem exists on the end, here. The exchange takes a fee and a spread. That means it’s quite likely I’ll end up with around $90 or so turned into GBP out the final end.
Instead of converting $100 into GBP, using crypto in its current guise means I’m only converting $90 into GBP.
The other problem is that even in the minutes that it might take for that process, I’m subject to crypto price fluctuations. And if the value of ETH falls even just one or two percent in those few minutes, I’m down more money again.
This highlights three problems with crypto:
- The issue of onramp from fiat money to crypto
- The volatility within crypto values minute to minute
- The off-ramp from crypto to fiat at the other end
The upside is these problems are all things that will get fixed. Soon enough there will be low cost (to no cost) onramps from fiat money into crypto. Then through decentralised exchanges you will be able to easily exchange from crypto to crypto — sometimes within the one application.
And then the off-ramp at the other end? Well, you won’t need to off-ramp back into fiat money at all. You’ll use your crypto to pay for various goods and services. Or exchange it for other cryptos, to do the same.
This process will take minutes, probably seconds. It will be seamless. It will be easy. It will be for everyone to access and use. It will operate any time of the day, in any place, anywhere in the world.
If it’s Easter, Christmas, a bank holiday, or even the Melbourne Cup, it won’t matter. The crypto ecosystem doesn’t take days off. It will enable 24/7, 365 global commerce and financial transactions.
The Easter break was fantastic. It gave us all a break from things. And also provided the best advertisement for using crypto we’ve ever seen.
This latest stuff-up from CBA is even more evidence to show that as crypto matures it will redefine banking and finance. The future is coming at you fast. And there are crypto projects out there right now that are making it happen.
We see it because we’re inside this industry and we understand it like no other financial analyst in the country. We see what’s coming. We see how it’s going to change everything.
Banks should be afraid because crypto is going to beat them into submission.
Editor, Secret Crypto Network