Banks can run on systems like NonStop we have gotten to five 9's reliability with components simple enough to formally verify. Most people's money doesn't get robbed. If they do, they can mitigate it with $50 max reporting it quickly. They can also stop payment if a provider screws them over. Their stored money is worth about same day 2 as it was day 1 since it's an actual currency aimed at stability. Compare that to cryptocurrencies with volatile value, inefficient systems, lower volume, more hacks, and more closed exchanges.
A public benefit or nonprofit setup for a bank with strict rules in a country with strict rules is way more trustworthy and efficient than the average cryptocurrency. The tech is also better since an ACID key-value store plus the kinds of credit and smartcards we already have is all you need for majority of activity. Stuff like FoundationDB hits ridiculously-high transactions-per-second with strong consistency. Banks already have lots of methods for catching fraud. A simple, online bank will have less go wrong technologically, legally, and so on since every part is field- and court-proven.
> Compare that to cryptocurrencies with volatile value
I was comparing the network, protocols, and interfaces that make the transaction happen, not the currency itself. Please don't take this as a endorsement of cryptocurrencies, because they do have problems.
Even with improvements you mentioned, there is just no comparison between the technical and mathematical simplicity of the cryptocurrency transaction as opposed to a bank transaction.
The blockchain was a truly genius innovation. It's that kind of out-of-the-box thinking that I believe we need more of and applied to more varied problems (and obviously not blockchain again, because that would be thinking in the blockchain box).
On other system, CheckChanges(CurrentStateorChanges).
That's it. All the extra stuff is for extra requirements or overhead from traditional, bank designs. It's not requirements for centralized banking. You can do the basics of banking, with crypto, on 16-bit microcontrollers on smartcards. You can do the ledger in memory with snapshots for persistence. You're talking load and store instructions plus some I/O. Super simple. The stuff proof engineers are mathematically modeling, implementing, and verifying down to the assembly is much more complicated than this.
Now, with cryptocurrency, it starts with some pretty math. That turns into a way more complex implementation than what I just described. Inevitably because their protocols are intrinsically more difficult than centralized protocols that just publish ledger for decentralized checking. Even the tools for verifying them are more in infancy than those for traditional systems. Then, there's the mass of code they use like Linux to operate. Then there's developers that can make changes. There can be lawsuits forcing things to happen. A lot more than math goes on with the cryptocurrencies even though proponents talk like it's just math that you can trust.
Now, someone might say their complexities aren't nearly as bad as traditional banking or weaknesses are worth it. The former might be true, but nobody has proven the latter given a centralized non-profit can do almost everything better. I haven't even seen opponents of traditional banks attempt to do better with centralized design. I have seen for-profit companies like PayPal, Western Union, Venmo, and an online bank in Go language vastly improve on the situation with clean-slate designs getting lots of market share away from bankers. Had idealists done that, they'd have millions to billions to spend on experiments like cryptocurrencies plus made a huge, positive difference in people's lives. That's because they are actually using the centralized alternatives based on traditional currencies. Can you imagine how much better they'd be if they were public benefit or non-profit companies with stuff in their charter and agreements protecting the customers? And that leverages existing laws that lawyers understand well.
> Can you imagine how much better they'd be if they were public benefit or non-profit companies with stuff in their charter and agreements protecting the customers? And that leverages existing laws that lawyers understand well.
Idealists opposed to traditional banking have done that, with significant success. Hence, public benefit banks, public banks, and credit unions.
A public benefit or nonprofit setup for a bank with strict rules in a country with strict rules is way more trustworthy and efficient than the average cryptocurrency. The tech is also better since an ACID key-value store plus the kinds of credit and smartcards we already have is all you need for majority of activity. Stuff like FoundationDB hits ridiculously-high transactions-per-second with strong consistency. Banks already have lots of methods for catching fraud. A simple, online bank will have less go wrong technologically, legally, and so on since every part is field- and court-proven.