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By Siamak Fereidooni
When banks are struggling to survive the new age, governments are making the financial system more fragile and volatile for them, so they fail
For centuries, banks have been the backbone of civilization's business and financial development. Banca Monte Dei Paschi di Siena, the oldest bank in the world, has been providing financial services since 1472. Throughout history, people have trusted religious centers to store their wealth in the form of gold, silver, and note drafts, creating a line of credit between religious accountants and merchants. However, as with any innovation, the banking system had to evolve to survive the test of time.
The 20th century saw a rapid rate of creation and destruction, which led to the need for adaptation. The Second World War, for instance, advanced medicine and telecommunication decades ahead of their time, with financing playing a crucial role in these developments. As such, it is evident that whoever has better assets has a better chance in war, and thus the need for funding and accounting for financial endeavors. Bankers played a critical role in financing countries and institutions to develop their visions, leading to the advancement of science and technology.
However, while investments have been done by glorified accountants with the support of the State Government and Public Funds, it has not always been done with good intentions. Some bankers have been involved in corruption, leading to bad investments, such as the one that caused the Nazis to rise to power. Therefore, it is essential to acknowledge that while banks have been instrumental in financing innovation, there are bad players who sometimes make bad decisions.
Over the years, the banking system has undergone significant changes. Before the widespread use of electricity, people with some level of comfort used candles and oil for illumination during the night, which was expensive. However, the introduction of electricity changed everything. J.P. Morgan funded Tesla and Edison, which produced bulbs on a large scale. Despite the great contributions of these scientists, not everyone saw their visions for the future as viable. For example, J.P. Morgan did not see Tesla's vision for the future as a viable option for himself, otherwise, we would have had a completely different world now.
With time, the banking industry evolved to meet the needs of the people. Banks were initially a place for wealthy people who had money. Still, as more people gained access to financial services, bankers had to open new branches and subsidiaries to meet the new needs. The American West Bank, for instance, created a new concept that it needs to operate like a business to profit. By not relying only on the interest rate, they brought themselves great opportunities and profit.
Funding innovation and people since the 60s gave birth to Silicon Valley companies. Venture capitalists (VCs) were allowed to fund tech companies believing they could control them, just as they did for the last two millennia. However, with the introduction of Bitcoin, they began to understand the grave mistake they made, and they had created a God Killer.
Blockchain technology is not new; its concept has been around for many years. What we have today is a new form of it that is way more efficient and foolproof. With Blockchain, people no longer need help from a legitimate person as their guarantee of work or financial affairs. It has made it easier for people to conduct transactions securely and efficiently.
The banking industry has undergone significant changes over the years, and there is still room for improvement. While the industry has been instrumental in financing innovation, bad players sometimes make bad decisions. The introduction of new technologies, such as Blockchain, has made it easier for people to conduct transactions securely and efficiently. Therefore, as the world continues to evolve, it is imperative to adapt or die, just as the banking industry has done over the years.
As for the future of banking, it is hard to predict with certainty. However, it is safe to assume that the industry will continue to evolve and adapt to new technologies and customer demands. Some experts believe that traditional banks may become obsolete as technology companies and fintech startups continue to disrupt the industry. Others argue that banks will still play a crucial role in the economy, but their business models will need to shift to stay relevant.
One thing is for sure: the role of bankers and financial institutions in our society will remain important. Whether they are providing loans to small businesses, helping individuals invest in their futures, or funding innovative projects, bankers will continue to play a vital role in shaping the economy and society as a whole.
In conclusion, the history of banking has been a long and fascinating one. From ancient religious centers to modern-day banks, the industry has evolved and adapted to the changing needs of society. While there have been instances of corruption and greed, bankers have also played a crucial role in funding innovation and advancing our civilization.
As we move into the future, the industry will undoubtedly continue to face challenges and changes. However, with the right vision and leadership, banks can continue to provide value to their customers and society as a whole. It will be interesting to see how the industry evolves in the years to come and how it shapes the world around us.
Author Bio
I'm a business consultant and financial enthusiast experienced in entrepreneurship and management. You can find more at: https://fereidooni.com
Disclaimer
The views and opinions expressed in this article are solely those of the authors and do not reflect the views of Bitcoin Insider. Every investment and trading move involves risk - this is especially true for cryptocurrencies given their volatility. We strongly advise our readers to conduct their own research when making a decision.