Nama : Rifqi hamzah Yugi Nasrullah

NIM : 23/518099/KT/10314

Bitcoin : A Weapon Against Traditional Banking

The US dollar has become THE world reserve currency with 58% of the reserve currency is
stored in dollars. The US government is also not shy to weaponize this fact. The US dollar
ability is last shown in the russia-ukraine conflict when the US sanctioned Russia on financial
and economic side. The US practically barred Russia and its citizens from doing

international trade and prohibited the use of the US Dollar. This blow has been one of the
indirect threat that the US government always use if any country is deemed against the US
interest.

(Russian Ruble down 40% after The US Sanction)

This has been seen as problematic by many central banks, as many of their trade and
economy depend on international trade hence the US dollar. Bitcoin offers a decentralized
system with no single people who can halt or stop the transaction is a great alternative to
supplement international trade. With no country or group that could control bitcoin it is free of
biased justice and forced sanction. This is some reason why Bitcoin could be an alternative
to the traditional currency.

● No middlemen

It is famous that Satoshi made bitcoin after the 2008 crash. The big bank at the time made a
huge risky investment with no regard for safety. The banking system is considered
irresponsible with the fall of Lehman Brothers who hold assets of $680 billion. With such a
disaster, bitcoin offers an alternative financial system that bypasses the irresponsible banker.

Bitcoin also has an upside on transparency that could resolve the untrustworthy middlemen
issue. When we move our bitcoin or trust it to another institution it is public record and we
know if our bitcoin has been tampered or moved. This is preventing the institution where we
put our money in to make unwanted investment under our name. It has happened before in
traditional banking as in Sarijaya Securities in Indonesia 2011. Sarijaya Securities made a
highly risky investment with customer money resulting in Rp14,82 Billion lost in customer
money. In blockchain it is impossible to happen because everything is public record and you
know when or where your bitcoin is transferred to. Even though you trusted your bitcoin o
third party, you know if your money has been moved

The cost of international transfer is also cut by bitcoin. With monopoly and older technology,
international wire transfer could be ranging from $5 to $40. Bitcoin could slash this price up
to $1 per transaction and continue to update its technology so the fee could become lower in
the future. Other blockchain and crypto are currently able to do the same transfer for $0.2. It
is clear that bitcoin transactions are a more efficient middleman in this global world.

(Bitcoin Transaction Fee Chart)

● No restriction on trade
As stated before, an International sanction, even an unjust one, could restrict the entire
nation from international trade. The bitcoin technology from blockchain could be an
alternative to such restriction. The blockchain technology is still able to do international
transactions even though your regime is under international sanction or when your country is
deemed a threat to the world superpower.

It also opened a new window to people who don’t have access to traditional banking and
could be instantly exposed to the international financial system. Before, only an account that
fulfilled certain requirements could do an international transfer, provided there is a branch of
the said bank in your city. Now bitcoin has been able to provide financial transactions to
people in communities that are far from the reach of technology. They could do small
transactions that aren't available in traditional banking and connecting to people all over the
globe.

● Safety measure
When doing financial transactions it is an obligation to make sure our transaction is secure
and protected. When doing the same nation transaction it becomes more secure as a
centralized government could reverse the transaction if anything goes wrong. But it becomes
tricky when your money gets stolen by another hacker as there is no single entity that could
become responsible and able to reverse the transaction.
It happened to the central bank of Bangladesh in 2016, when a group of hackers attacked
and stole US$101 million. It became tricky and irreversible because the money transferred to the
Philippines and laundered there. The traditional banking could be breached and there is a
chance to be hacked.

Bitcoin even though it is irreversible once the transaction gets through, it is almost
impossible to get hacked. The hacker needs to own 51% of the computing power in the
blockchain so the transaction could be done. It is almost impossible as virtually anyone in
the world could become a part of the blockchain as long as they have a computer. The cost
to break the bitcoin blockchain is higher than the entire networth of the bitcoin itself.

Blockchain is basically just a simple ledger with anyone becoming the admin on their own
wallet/account. It is different with traditional banking when the hacker could gain access to
the super admin (the bank account), and practically the hacker has control of the entire
user's money and account. The bitcoin on your wallet could only be moved with your will,
and no third party or government could touch your asset.

In conclusion Bitcoin is a great alternative to traditional banking as bitcoin has many upside.
The blockchain technology is a new path that has not ventured before in our technological
journey. With great feature, there is a lot of utilization in this technology