We all love the blockchain and crypto.
Not just because of the anonymous part of it. But also the fees and the control that banks exert is missing in the crypto. And that is one of the reason decentralized coins and the tokens are thriving lately in the market.
There was a time when the market was not adopting the crypto because people tend to be loyal to govt based banks and the centralized nature of the money. But slowly since pandemic crypto has lost the plot of it's decentralization.
Since pandemic crypto is more centralized as the nations are holding the bitcoin and ethereum in their treasury. And they seem to be more leaning towards accumulation warfare. For example El salvador has been holding more crypto than any nation in Asia.
That's not all. Even USA is getting its' own reserves and the banks are holding the crypto for the consumers in their portals. This has been getting more serious in their actions last few years and they are now adopting to cater to the crypto consumers in their nations.
So how are banks using blockchain and crypto?
Banks are creating their own chains. And collectively the bank groups are subscribing to internal chains in order to settle payments faster. More faster than their current products and the services they are importing from others. For example Stellar seems to be offering such services to many banks in India, China, Srilanka.
Apart from building your own chain they are also using the chains of the SWIFT and IBAN which are already age old payment solutions which are now upgrading for the blockchain. And they are settling the international payments much faster and also stronger with the stablecoin support.
Third, they are also creating and using their own stablecoins or choosing to adopt single stablecoin or CBDC as they say. Which means they have more control over the quick payments which any modern consumer wishes to use in it's system.
In short banks are adopting following practics in their ecosystem:
- Using blockchain to settle domestic and international payments
- building their own native local and national blockchains for internal use
- adopting usage of blockchains on SWIFT, IBAN and other international usecases
- Using stablecoins locally and internationally.
In order to stay alive they have to focus more on the digital payments. And they would be able to work with the new generation and also make it easier for consumers to move money. More offline they keep consumers the less money moves and the nation is likely to face more financial issues.
As for being more relevant in today's time they have to adopt the crypto. Otherwise ethereum and bitcoin adoption alone would replace banks from the nations around the world. That would be bad for the governance and also bad for the consumers who are invested into banks.
In short being relevant in todays time you have to use crypto and you have to exchange crypto in order to not let blockchains destroy the foundation of banks. And the people who are behind those things would be making use of the blockchains to keep bank institutions alive.