When you rest, you rust. That’s something we firmly believe at Luno, which is why we are always working to change and adapt. Disruptive technologies, like cryptocurrencies, can carry negative connotations and instill a sense of fear by the simple use of big-bad-wolf words like ‘disruptive’. Instead, you could consider this technological disruption a factor of positive change, especially when it comes to having more control over your own money.
History of banks and currency
Traditional banking institutions have been around for centuries, and when you consider how much has changed over this time, especially over the past 50 years, it seems only natural to expect traditional banking to do the same.
Exchanging value came from a need to trade for goods or services. These early currencies were commodities that held inherent value, like salt or livestock. It was easy to see how these were used for trade because their value was obvious to both parties. Cut to around 2500 years ago in China, representative currencies, such as paper banknotes, replaced this system.
This is because currencies like paper banknotes or coins are transportable, divisible, interchangeable, and form part of a trusted system for exchanging value.
In the past, people trusted and relied on banks to safely store their currency, and more importantly, record transactions accurately. Some people have tried alternatives, but none that were as safe as money in the bank. Besides, we don’t imagine sleeping on a lumpy cash-filled mattress is all that great for your back, and strapping it to the back of your toilet is, well, gross. We’ve seen that the banking system of the past hasn’t quite caught up with the digital transformation of the present.
At its core, one of the biggest factors driving the financial evolution can be attributed to individuals’ desire to have control over their own money. Traditional banking systems use your money to make a profit while limiting your access to it; whether by making you wait days for the money to transfer between banks, or holding it hostage with terms and conditions in complicated banking products.
Banks and your money
When banks lend your money to their other customers, the bank essentially ‘invests’ those funds. But banks don’t just invest by making loans to their customer base. In fact, some banks invest extensively in different types of assets. Adding to that, fractional reserve banking systems enable bank loans for more than the funds actually available to a bank.
Bureaucracy and red tape limit the control people have over their accounts. For example, banks are often closed on national holidays, impose lengthy waiting periods for transactions to clear, or even force customers to keep a minimum amount of money in their accounts in order to keep them open.
Assuming the best in people (as our mothers have always taught us to do), banks created all this red tape in an effort to curtail fraud and protect their customers. However, all it does is make fraudsters more creative with how they steal your money. Cryptocurrencies don’t have the same problems, especially when intense security measures are taken to protect your cryptocurrency wallets.
How are we different?
Our number one priority is to keep your cryptocurrency safe and secure. Our internal storage and security measures include online storage (a.k.a, a ‘hot wallet’), offline storage (or cold storage) and deep freeze storage.
In this way, some of the benefits associated with storing and managing your cryptocurrency with us include:
- Your money is accessible 24/7 - holidays and bank closures don’t affect your ability to manage your finances
- Sending and receiving cryptocurrency from anywhere in the world
- Complete control over your money
- Improving accessibility for those who may not have access to modern banking
systems, but do have access to the internet and mobile phones
- Eliminating human error and fraud
- Your personal information is kept safe
- Increased security
We believe you should have total control over your money, and in turn enjoy true financial freedom. We’ve delved a little deeper into how we perceive the future of banking, and how we believe crypto services, like us, can work together with banks.
Right now, decentralised cryptocurrencies are independent of any sort of institutional control and Bitcoin is largely immune to some of the most serious problems fiat currencies face. We invite you to join the evolution and empower yourself with the opportunity to use your money when you want, how you want.
Sign up to Luno now.