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Cryptocurrencies: Alt/Bitcoin

How about hosting Bitcoin wallets and possibly other crypto-currencies?

 

Likewise, buying, selling, and trading with bitcoins would be great so a member can convert some cash into bitcoins.

22 Comments
Community Manager

Hi @PeterFA Thanks for being here! This is a space we're keeping a close eye on, but currently don't have any immediate plans on supporting. Thanks for kicking off the conversation with the MIX community! JohnS

Sightseer

Hey JohnS,

 

Tell whoever you can to look closer, as fast as they can.

 

Right now, the only serious coin exchange/bank account hybrid that exists is Coinbase. Based off of fees alone, they have an estimated revenue of 100-500 million a year, with almost zero competition.

 

The fact of the matter is that digital currencies aren't going anywhere anytime soon. The very nature of their existance is to persist, and usually increase in value.

 

The downside of attempting to implement digital currencies is a few peoples salaries for a couple years to see if it's viable and implementing the system. The upside is the potential billions of dollars in revenue. Just sayin.

Community Manager
Status changed to: Further Consideration

Hey @Windseeker! We think you're right, digital currencies aren't going anywhere. It's an exciting segment and we've done extensive research in this area. Right now, increased regulations and the risk associated with this emerging currency does not make it a viable option at this point for BECUDon't worry, though, we do have eyes on it - in fact several pairs just a minute ago discussing your post. As always, we'll keep you updated here with any new developments. Thanks! JohnS

Sightseer

BECU, please do *not* be a leader in digital currencies. Yes, windseeker is correct that a lot of money will be made in bitcoin, ethereum, or whatever comes next. But that's not what a credit union is for. We all remember WaMu and how they pursued risky ventures to the detriment of their customers.

 

By offering digital currency, BECU will be implicitly endorsing it and encouraging customers to use it. This could leave a lot of people burned. While the concept of digital currency isn't going anywhere, no available implementation can yet be considered stable.

 

Even worse, becoming a bitcoin bank puts a big red target on BECU for all the malicious computer attackers the world over who would love to steal untraceable money. Such bank heists have already occurred.

 

Another issue: Did I say "untraceable"? I meant, untraceable for professional criminals, but unexpectedly public for normal people. By their nature blockchain algorithms make a record of all transactions that anyone can see. Yes, it's supposed to be "anonymous", but everyday people don't go to great lengths to hide their identities. Once your identity is let slip, everything is revealed. This is not good for BECU customer privacy.

 

I don't bank with BECU for "innovative"  banking practices. I  am a BECU member because they are trustworthy. Please stay that way.

 

Trailblazer

@benwong Thanks for the information. I wasn't aware of some of the risks. To handle it BECU could impose an in-person requirement for ordering access to the services, just to make sure that the customer asking for it knows what he or she will be getting. Regardless, if it is too difficult, BECU shouldn't try.

 

I do think that adding the hosting environment would be great. That way we can host the wallet and use the wallet. There's really no way to identify the user unless BECU's data is leaked. At that point, it's game over anyways. Having some identity that a user can control through BECU with an identity doesn't mean that identity will bleed through the account when it's used.

 

In the end, it's always caveat emptor.

Sightseer

I would prefer that BECU stay away from any alternative currencies that have the primary benefit of anonymity.  Rather than try to enable using these currencies, which are best for criminal transactions, BECU should pursue the nirvana of real-time money (actual US Dollars) transactions.  This is far bigger than BECU, but with the other banks and the fed we could enable real time payments between financial institutions.  It would require that transactions include more information than they do now, and major changes to our banking systems, But it would be worth the effort to be able to conduct financial transactions in real time, auditably, and with all the information needed to perform accounting, including tax accounting.

 

Image a bank statement that included all the details of a transaction:  what you bought, the invoice number, transaction number, exact date and time, exact location, full name of the vendor or person paid, how much tax was paid, etc.  You would be able to do so much more with your bank statements - determine when you last got the oil changed, determine if that discount store membership is really worth it, actually know how much money you are spending, where, and on what.

 

Blockchain is an interesting technology, and it might be valuable in implementing an interbank exchange system.  But as long as bitcoin is primarily about anonymity, it will continue to be primarily useful for criminal conduct.  BECU should be about honest people and businesses conducting legal business with each other.

Trailblazer

You don't have to have your wallet hosted by BECU if you want. First of all, the currencies are only quasi-anonymous and second by law BECU has to verify the identity of each member. There's even a compliant Bitcoin out there now: https://bitaml.com/

Anyways, Etherium has smart contracts. I'm not fully aware of what this is, but I presume one can enforce a contract via block chain calculations.

Adventurer

I agree with @tmercer

Sightseer

Sounds to me like a bunch of people that believe everything their favorite FOX or CNN propaganda tells them... Cryptocurrency is not some evil currency that only benefits criminals.... following that logic you could say them same about the US dollar considering criminal activity is in the tunes of 100's of billions of dollars every year.

 

If anything that you think you know was true then all of the worlds largest banks and corporations would not be jumping on the blockchain bandwagon and currently investing 100's of billion into cryptocurrency.

 

Here are the largest:

https://entethalliance.org/

https://chain.com/

https://www.r3.com/

https://www.hyperledger.org/

 

Just google the press releases for any of these to see how wrong you are unless we call corporate america for what it is, a bunch of criminals then yes you would be right Robot Happy

 

 

With that said I dont see BECU jumping on the bandwagon, in fact they would be pretty dumb to do so, the tech is easily hackable and not scalable at the current moment. More work needs to be done before it becomes a reliable platform.

 

With that said BECU also blocks anyone in washington  state from buying ETH, BTC, LTC.... Kind of pisses me off I would like the ability to invest my own money in these currencies that are being backed by all the major players before it goes mainstream and BECU thinks its their right to decide what we can invest our money in. 

 

I am here to ask that BECU stop blocking wire transfers and debit card purchases to the exchanges that are licensed to do business in Washington State like Gemini, Coinbase, CoinMama... they all have their licenses now let us invest or I will find another credit union.

Sightseer

These coins are being offered to us as being equivalent to currency, with some privacy-respecting and government-snubbing arguments added for spice.

 

The reality, I believe, is:

- These are not currencies but speculative vehicles, anyone saying otherwise in my experience stands to gain from convincing you of this

- Coins incentivize people to hold cash outside of the real economy - this money is not reinvested in real-world companies and goods but is instead hoarded

- Coins reward those who arrive first and buy up as many as they can, somewhat like a pyramid scheme

- The pro-transparency (blockchain) and pro-privacy (anonymous) arguments used to defend coins are mutually exclusive and incoherent

- Currently the amount of electricity to do mining is equivalent to the energy needs of Denmark; this will only rise, driving energy demand in pursuit of pointless wealth creation, much like privately-held companies making sure the public bears its risks and costs

 

The only reason we're hearing so much about these damned things is that the rate of return is insane - for now. The rate of return on tulips and subprime tranches was also fantastic. The other garbage talked about in association with these coins is just nonsense.

 

Will money become digital? Yes, it already has - the US just is way behind the times (we only just now got chip and pin). Will it become fiatless and associated with no government? I'm sure traders today would love a transactional medium that fewer people can take a cut of, but then again they like stability, and the idea that there's someone there as the 'banker of last resort'.

 

Apologies for tone; I was initially fascinated with these things and thought they were an incredibly imaginative feat, but now I see them as allowing every libertarian the fantasy of having their own pile of gold in an offshore shelter, and excacerbating the tendency of people now to remove as much money as possible from the communities in which they live.