Banks Are Toast but Crypto Has Lost Its Soul

Banks Are Toast but Crypto Has Lost Its Soul

(Oli Scarff/Getty Images)

Frances Coppola, a CoinDesk columnist, is a freelance writer and speaker on banking, finance and economics. Her book “” explains how modern money creation and quantitative easing work, and advocates “helicopter money” to help economies out of recession.

The 2008 financial crisis created an extraordinary financial melting pot. Into the soup went the legacy system, now shown to be unfit for this purpose: new ways of transacting in old currencies and new types of money. This witches’ brew has now been stewing for over a decade, but the type of potion it will eventually produce is still unknown. Will it be a financial system fit for the digital age? Or will it simply be a souped-up version of the old system, with all its flaws and toxicity?

The immediate response to the 2008 crisis was to tie down the banks that had so nearly blown up the world. New rules were created to restrict their activities. New regulators were created to police their activities and prevent them doing anything that looked too risky. New capital and liquidity requirements were imposed on them so they were less likely to run out of money in a crisis and, if they did, less likely to need bailing out by taxpayers.

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