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How and why would bitcoin treasury companies become neobanks?
1909 sats \ 17 comments \ @k00b 16h bitcoin
Someone floated me the idea that Saylor aspires to turn Strategy into a neobank. When I asked him what made him think that he cited a friend's reasoning in a private "cypherpunk" group chat.1 He couldn't recall the details but said it convinced him that was Strategy's strategy (and represented a level of hubris that would be Strategy's ruin). Then I saw this sloppy article which validated the idea a bit.
I can't make heads or tails of it. My hope is someone here can.
  1. How does a large bitcoin treasury give you a competitive advantage when starting a bank?
    • Having lots of money is an advantage, generically, but is there something more to it than "rich people can start banks because banks are mostly just expensive to start and run"?
  2. Why would a bitcoin treasury company want to be a bank?
    • I imagine they'd be able to fractionalize their treasury for lending, somehow using their own bitcoin as collateral in some part of the process, and effectively generate yield on their bitcoin while getting closer to the money spigot.
    • I imagine they'd also attract deposits which they could use to buy more bitcoin, while their liabilities are priced in fiat.
  3. How would Strategy transition itself to a neobank? Would it acquire an existing bank or is it easy to spin up a bank these days?
Does anyone have any more insight into this kind of thing? Or have you seen any public writing to this effect that you could share?

Footnotes

  1. I was also immediately disappointed that this wasn't shared as a post on SN at some point. It sounds like a banger. ↩
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200 sats \ 5 replies \ @DarthCoin 10h
Saylor aspires to turn Strategy into a neobank
I've said that long time ago and multiple times here on SN and also provided the video in which Saylor mention that specifically.
Michael Saylor say it very clear: he will buy all bitcoins available, will HODL them and later will lend them as collateral to all poor guys that today do not want Bitcoin. In plain sight you have the banksters and billionaires plan: to enslave you again in debt. If you still do not understand that, means that humanity deserve to be forever enslaved by few…
and here is the video:
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50 sats \ 4 replies \ @siggy47 2h
I remember first listening to Saylor and he would describe how rich people never sell their assets, they borrow against them as collateral to pay their expenses.
When Saylor and his insider friends began selling mstr (they're still at it https://www.marketbeat.com/stocks/NASDAQ/MSTR/insider-trades/ ), it became obvious that they knew mstr wasn't an asset.
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36 sats \ 2 replies \ @xz 1h
What is mstr? Strategy borrowing against assets as collateral to pay their expenses?
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43 sats \ 1 reply \ @DarthCoin 59m
What is mstr?
used toilet paper
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0 sats \ 0 replies \ @siggy47 57m
😀
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36 sats \ 0 replies \ @DarthCoin 1h
rich people never sell their assets, they borrow against them as collateral to pay their expenses.
100% explanation for fractional reserve hahahaha and clueless people still fall for this trap.
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100 sats \ 1 reply \ @bitcoingraffiti 7h
E.g. he just launched $STRC. This is a 9% APY monthly dividend fixed income product.
Basically you can hold this risk free in your brokerage account and just receive the interest, not much different than saving at a fiat bank.
Fiat banks could even offer their savers a 5% APY monthly interest by parking their money in $STRC, earning the spread.
So indirectly, MSTR is already a bank. You won't park your Bitcoin with Saylor, but your fiat.
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0 sats \ 0 replies \ @nitter 7h bot
https://xcancel.com/saylor/status/1947392236536070317
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100 sats \ 0 replies \ @5atoshiNakamoto 11h
Of course Strategy will become a bank of the future. Bitcoin is money. Right now, these Bitcoin treasury companies are novel because this is a new concept for money. But in the future, saying you're a "bitcoin company" will be like now saying you're a "money company". Every company everywhere will be using Bitcoin, so the options for how Strategy wants to use their massive amount of Bitcoin will for sure lead them into becoming likely THE largest bank of the future.
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121 sats \ 3 replies \ @justin_shocknet 15h
A lot depends on how we define neobank... Investment? Commercial? Depository? Payment processor? Exchange 👀?
Also we can't project the future by speculating on Saylors vision or hubris/lack of. Too many external forces will be exerted on something of Strategy's scale, that it will eventually become high time preference. Every temple falls.
... So Saylor has spoken about the importance of network effects in finance, MSTR options market for example having no peer... His head start on the fixed supply future financial system automatically gives Strategy network effect for whatever it feels it has to pursue in the future
If equities get tokenized and regs relaxed, MSTR stock becomes indistinguishable from a fake L2 and therefore a payment rail. It's other tranches become stables or interest bearing accounts... Very bankish.
These shittokens also need an exchange, and exchanges make a killing with fake layer 2s already... Imagine boltzexchange/side swap fees on strategy volume.
Being headquartered outside of DC and connected to the IC, whatever changes to regulation are coming they're ready for. Even if they have to buy a banking license by buying a bank, they're in a better position to monetize it than most.
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17 sats \ 1 reply \ @xz 38m
dolphin3 tells me they 'typically offer mobile-first banking services to individuals and small businesses with features like account management, bill payments, money transfers, and investments.'
Every financial app I see now tends to offer a 'free' credit card, and then all the things you'd associate with credit cards. I feel it's pretty hard to distinguish any 'kind' of neobank. They all seem to be really interested in you either sharing data between other banks, switching to/from other banks and 'knowing more about me' as I seem to remember one cab-hailing app say.
Will they all just end up being everything apps that want your attention and data?
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0 sats \ 0 replies \ @justin_shocknet 31m
Will they all just end up being everything apps that want your attention and data?
As long as that's the obvious path to monetization, you can count on it. That said, at this stage it feels like its shuffling the deck chairs on the Titantic... at some point the cost of data and attention has to be value. This can't go on forever.
That is what gives Strategy a leg up in the future imo, they have a fixed percentage of the new financial system... so they won't need a gimmick Credit Card that has lesser rewards than Discover has had for ~20 years to attract high-churn (l)users.
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32 sats \ 0 replies \ @DarthCoin 10h
A lot depends on how we define neobank
Are all scams
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200 sats \ 0 replies \ @Undisciplined 15h
I've seen this idea mentioned as though it were common knowledge, but I've never seen a description of how it would work.
It's no even remotely easy to start up a bank.
I recall from my history of money reading that goldsmiths were amongst the earliest bankers. The reasoning here might be somewhat similar. They were the ones who were accustomed to handling large amounts of gold and storing it securely, so people started paying them to use their storage facilities. Then, they started (over)issuing redemption notes, which circulated far more broadly than the physical gold would have.
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21 sats \ 0 replies \ @dough 14h
I could see them taking deposits and offering collateralized lending at very attractive rates
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10 sats \ 0 replies \ @flat24 14h
I regret not add information or some really important data in this fantastic publication.
What I can contribute, is what I think when you see all this uproar with the companies that begin to add Bitcoin to their treasury, with this that the banks accept Bitcoin as a collateral for loans.
  1. These companies will cause the next bubble, which then unleashed a good price discount. (Bear market, or the respective setback of the fractal major bullish)
  2. The banks and Governments have already assumed that they cannot overthrow Bitcoin. So now they plan to get as much as possible.
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0 sats \ 0 replies \ @Macoy31 7h outlawed
stackers have outlawed this. turn on wild west mode in your /settings to see outlawed content.