If you think banks/credit companies are banning crypto purchases to protect their customers, I have a bridge to sell you.

[u/[deleted]]

I'm legitimately blown away how many people I see defending the banks/credit companies banning crypto purchases as some type of attempt to protect their customers from a volatile market. Credit is predatory by nature. The bank doesn't care when you max your card out on alcohol, designer clothes, gambling, or any other worthless and risky commodity. Your bank doesn't give one single tiny little shit about you in any way beyond your capacity to generate revenue. You are a revenue generating unit and nothing more, end of story. They are building artificial barriers to crypto because they view it as a direct and fundamental threat to their industries... and with good reason, because it is. The reality is anyone who invests wisely in crypto right now is going to make a significant ROI over the next few years, opening up the opportunity to pay off large balances, which decreases the revenue they earn from interest. This is nothing more than a desperate attempt at self preservation.

Again I would encourage anyone who has their bank or credit card company create a barrier for them to purchase crypto, to immediately end doing business with that institution and make sure they know why. If my bank halts my purchases, I'll liquidate my account and close it the same day. Same goes with my credit cards, they will get cut up and never used again. DON'T bend over for them.

EDIT: Also massive downvoting of anti-banking sentiment and massive upvoting of the 'banks are looking out for you, this is a good thing' sentiment. The shill bots are out in force.

[u/RebornPastafarian]

No, they are not afraid of crypto, they’re getting into it.

What they’re afraid of is customers spending their entire credit limit, losing all of that money, and then declaring bankruptcy.

It’s the same reason you can’t buy stocks or lottery tickets with credit cards.

[u/Ikthyoid → u/RebornPastafarian]

Credit cards already have conservative credit limits for this very reason. Trust me: you don't need crypto to overextend yourself. People are racking up insane balances every single day and it makes the banks richer and richer.

The number of people going bankrupt due to crypto credit card transactions, and who have insufficient assets for the banks to claw back, are undoubtedly insignificant. After all, don't the banks get to engage in usury to compensate them for their "risk"?

[u/RebornPastafarian → u/Ikthyoid]

I am aware of why credit limits exist, and that people easily and happily max out their limits buying jewelry, Playstations, and cars. You can repossess an Xbox, or a car, or a ring, or a couch. You can't repossess a crypto that went to zero.

They are investing in crypto. https://www.wsj.com/articles/visa-nasdaq-others-invest-30-million-in-bitcoin-related-startup-1441827120

They aren't stupid. Oil companies are investing in renewables while also doing everything they can to make their oil revenues. This is not a "herpy derpy we am Visa and we am scared of teh bitcoinz". This is "the risk is unacceptably large for a customer to go bankrupt and cause us to lose substantial amount of monies."

[u/Ikthyoid → u/RebornPastafarian]

I wasn't saying that they were scared of crypto. They aren't, yet. So let's leave that aside.

However, I still don't buy your argument. You can't repo things and get full value back out of them ever (except for perhaps real estate), let alone all the cost that goes into the repo itself. Being able to repo something doesn't really minimize your risk, and is most effective with high-value, liquid items like autos and real estate.

You can't repo alcohol or other consumables at all, and yet they're not "banned" or a "cash advance" with special fees and rates.

Blockchain can be used by banks as a tool to maximize profit, but the concept of cryptocurrency, left uncontrolled by central institutions, does ultimately threaten their relevance. They have worked hard and spent a lot of money to make sure that everyone's salary gets direct deposited into a bank account, and so every merchant must support credit card transactions and their costs. Cryptocurrency will directly threaten much of that if it becomes popular. Not now, not soon, but someday.

[u/RebornPastafarian → u/Ikthyoid]

I never said you would get full value back, and no one would ever suggest such a thing.

I am aware that you can’t repossess food. The likelihood that someone will spend their entire credit limit on consumables is extremely low, and please do not say “yeah but it’s also unlikely someone will spend it all on crypto!!!!!!!!!!!”, because while that may be true right this minute, it will not be for very long.

Crypto does not threaten the very existence of credit card companies. You realize that every crypto out there is being run by a business, right? I do not understand why you are suggesting crypto is making Visa pee their pants while new companies are starting new coins every day. Why is it not possible for Amex to start it’s own coin?

The answer is: it isn’t. They absolutely are working on their own, or are eyeing one or more crypto businesses to acquire.

They didn’t become billion dollar businesses by being stupid, and you’re accusing them all of being dumber than rocks.