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Euro Bank Santander Commissions Study On Bitcoin's Impact On Banking

timothy posted about 2 months ago | from the first-they-commission-a-story-about-you dept.

Bitcoin 50

First time accepted submitter Nikkos (544004) writes Digital currency news website HashReport broke the news Monday that European megabank Santander has commissioned a study to "Analyze the impact of bitcoin and other cryptocurrencies on banks and devise a strategic course of action." The study is being facilitated as a challenge through Yegii, an 'Insight Network' founded by Trond Undheim. Undheim is also a Senior Lecturer at MIT Sloan School of Management, as well as Managing Director at Tautec Consulting. The challenge was initiated by Julio Faura — Head of Corporate development for Banco Santander. According to Dr. Undheim, Faura was "looking for additional outside perspective onto the topic of Bitcoin. While acquiring consulting services from top tier consulting firms can be exciting, he thought that an outsider, multidisciplinary perspective, would be particularly helpful."

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hm (1)

Anonymous Coward | about 2 months ago | (#47772719)

Does this mean that cryptocurrencies are getting succesful?

Re:hm (5, Insightful)

segedunum (883035) | about 2 months ago | (#47772731)

No. It just means that banks are looking for ways in which they can manipulate them.

Revenue earner (2)

Taco Cowboy (5327) | about 2 months ago | (#47772925)

For banks the virtual coins are but another form of financial vehicles but for government it represents new ways of landing them more $$$

Re:hm (1)

thieh (3654731) | about 2 months ago | (#47773015)

Or the governments are trying to find ways to tax the transactions done in Bitcoin.

The US already found a way to tax Bitcoins ... (2)

perpenso (1613749) | about 2 months ago | (#47774853)

Or the governments are trying to find ways to tax the transactions done in Bitcoin.

The US already found a way to tax Bitcoins, as an asset. They announced this earlier this year.

I believe that miners have to record income on the day they received coins from mining operations and that sellers have to record a gain/or loss at they time they sell/trade coins. This means that when you buy that cup of coffee you have to note the price difference between when you acquired the coins and when you bought the coffee, and report that gain/loss.

Re:hm (1)

Joce640k (829181) | about 2 months ago | (#47775299)

No. It just means that banks are looking for ways in which they can manipulate them.

Either that or the person that "commissioned" this study has personal interests (ie. family) in the company that's doing it.

Wall Street will speculate on anything ... (1)

perpenso (1613749) | about 2 months ago | (#47774787)

Does this mean that cryptocurrencies are getting succesful?

No. Wall Street will speculate on anything that can possibly be sold at a profit. Intrinsic value and low risk are not required, read up on the origins of the recent banking crisis.

All this means is that there is a short term potential for profit by trading in crypto. Any actual value or utility in crypto would be irrelevant to Wall Street.

Less profits for big banks (4, Insightful)

MrL0G1C (867445) | about 2 months ago | (#47772733)

With bitcoin being good for money laundering, the big banks will lose that source of revenue.

Re:Less profits for big banks (1)

Anonymous Coward | about 2 months ago | (#47772847)

why would they lose anything? Why would bitcoin be any different from any other innovations and developments - any tool or idea can be used in support of freedom and liberty and more effectively againts them. Why would inter-pipes and all related stuff be any different? I mean looking at all the tools that we already had before bitcoin rushed to use our graphic cards all other inventions, processes etc have been more effectively used to crash upraisings than to support them. So how is bitcoin any different in this respect?

Re:Less profits for big banks (1)

Cardoor (3488091) | about 2 months ago | (#47773217)

"Give me control of a nation's money and I care not who makes it's laws" — Mayer Amschel Bauer Rothschild

Re:Less profits for big banks (0)

Anonymous Coward | about 2 months ago | (#47772951)

That's a pretty good point. I guess next thing you'll see is lobysts trying to dirty bitcoin so everyone goes back to using banks for their *cough cough* "legit" banking.

Re:Less profits for big banks (1)

Charliemopps (1157495) | about 2 months ago | (#47772953)

With bitcoin being good for money laundering, the big banks will lose that source of revenue.

Money laundering was never hard in the first place. Disreputable banks just make it a tad more palatable to people who don't consider their behavior "wrong" and I doubt bitcoin changes that at all.

Re:Less profits for big banks (3, Interesting)

Anon-Admin (443764) | about 2 months ago | (#47772973)

These comments about bitcoin being good for money laundering are such BS. Do you even understand what money laundering is?
Note: I have worked in Financial IT and have had the AML (Anti-Money Laundering) training which was less impressive that it sounds. lol

The point of money laundering is to make an illegal income look legal. To take large amounts of a given currency received for an illegal act and to provide it a banking trail that makes the money look like it came from a legal source of income.

In most cases money laundering starts with large amounts of cash. Buying bitcoin does not magically make it look ligitement, and what exchange takes cash?

The truth is money laundering tends to be done by mixing the illegal money into the income of an all cash business like vending machines, massage parlours, small computer stores, etc. Then showing it as ligitement income on the books.

Re:Less profits for big banks (2)

Cardoor (3488091) | about 2 months ago | (#47773103)

first and foremost, if you want to give someone cash for their bitcoins, im pretty sure you could find a willing participant on the other side.maybe it's at a discount to the nominal exchange rate (but presumably not as onerous as the 30-40% that 'better call saul' quoted walter white).

in any case, w/r/t money laundering, while technically correct on some points, your argument misses the larger purpose. money laundering is, at it's core, a means by which either illegal or simply non-tax-reported income can be re-introduced into the economy without alerting authorities for either purchases of goods/services, or for electronic transfer (ie, wiring money instead of trying to cross the border with suitcases full of cash).

to the extent that btc becomes ubiquitous in use, acceptance, and most importantly, the average persons 'wallet', then cash need not be *any* part of the initial illegal/untaxed transaction... while still providing purchasing power into the real economy for the new BTC owner, as well as immediate means of electronic transfer.

Re:Less profits for big banks (0)

Anonymous Coward | about 2 months ago | (#47773195)

In most cases money laundering starts with large amounts of cash. Buying bitcoin does not magically make it look ligitement, and what exchange takes cash?

Bitcoin ATMs? Localbitcoin?

Or, I dunno, ask this guy [arstechnica.com] ? He'll probably be even helpful and tell you how to throttle your actiivity as not to trigger AML reporting requirements.

Re:Less profits for big banks (1)

MrL0G1C (867445) | about 2 months ago | (#47773321)

Fair enough, except for the situations where the initial bitcoins have been stolen - there are bitcoin services specifically to hide the bitcoin origin.

Re:Less profits for big banks (2)

Anon-Admin (443764) | about 2 months ago | (#47774061)

Ill reply to my own post to answer many of you who replied.

Changing cash to bitcoin and back to cash does nothing to launder the money. Move the money, sure, but not laundering it. Even moving it out of country does not launder the money and then the person receiving the money still has the task of getting it converted back to $$ without raising suspension.

To those that list localbitcoin or atm's, really for money laundering you would need LARGE amounts. We are talking number above 20k but to be honest it would more than likely be in the millions. There is no buying 50k in bitcoins from an ATM and localbitcoin, although great for a few $100 falls a bit short when talking 20k+

Re:Less profits for big banks (0)

Anonymous Coward | about 2 months ago | (#47773077)

With bitcoin being good for money laundering, the big banks will lose that source of revenue.

You have absolutely no clue about what you are talking about. Anti-money laundering laws in the United States and Europe are pretty tough and bring with them some pretty severe penalties for not following them.

http://blogs.reuters.com/financial-regulatory-forum/2013/07/08/bank-regulators-globally-add-aml-to-safety-and-soundness-issues/

Re:Less profits for big banks (2)

nedlohs (1335013) | about 2 months ago | (#47773173)

Sure.

Launder money for drug cartels, sanctioned states, and terrorists for years, ignore multiple "stop doing that" orders for regulators and when caught red handed you get a fined a few weeks profits and told you are too rich and powerful for the government to bother with the slam dunk criminal case.

Very severe!

Re:Less profits for big banks (2)

oodaloop (1229816) | about 2 months ago | (#47773725)

With bitcoin being good for money laundering

lolwut?

Re:Less profits for big banks (0)

Anonymous Coward | about 2 months ago | (#47774195)

>With bitcoin being good for money laundering

Yes, currency whose entire existence is dependent on every transaction being recorded in a ledger that everyone must have a copy of is the very best option for money laundering out there.

If you can't tell, I'm being incredibly sarcastic.

On Banco Santander reports (4, Insightful)

ccguy (1116865) | about 2 months ago | (#47772735)

As someone living in Spain and doing business with Banco Santander I can assure you they're experts on bullshit reports. Whatever this report says (It's not my go potty time yet so I haven't read it) don't worry much unless you are in Spain. If you are then just expect a law on BitCoin to be passed soon.

Re:On Banco Santander reports (3, Interesting)

Pax681 (1002592) | about 2 months ago | (#47772807)

Yup....Santander are assholes. they took over my bank (alliance and leicester) who were decent till santander took over.
soon it was charges for this and that.. total PITA.
now i bank with my local credit union and i am MUCH happier

Re:On Banco Santander reports (1)

mjwalshe (1680392) | about 2 months ago | (#47772843)

yes my local A&L went down hill badly after the take over! Though to be fair they have improved a lot in the last 18 months or so - so much so that I didn't move all my accounts

Re:On Banco Santander reports (0)

Anonymous Coward | about 2 months ago | (#47772947)

Yup....Santander are assholes

and their logo represents a fuming turd

Re:On Banco Santander reports (2)

SuricouRaven (1897204) | about 2 months ago | (#47772961)

I'm a former A&L customer too, but I never really noticed any change at all. But maybe that's because I use them only for the current account service, no loans or credit cards or other tools of finance.

But I've got to contact them soon about a soon-to-mature savings bond I got years ago, so we shall see.

Re:On Banco Santander reports (0)

Anonymous Coward | about 2 months ago | (#47773355)

Beware, Santander have been known to simply miscalculate the running balance of accounts. I don't know if yours could be affected, but it's probably wise to do a few spot checks while you take advantage of the Account Switching Service to go somewhere else inside a week :-)

Re:On Banco Santander reports (0)

Anonymous Coward | about 2 months ago | (#47773875)

I had the same experience with NorthWest -> Wells Fargo, though it did take a few years to turn truly sour.

$5/mo per account, I am GIVING you money to lend FFS.

Re:On Banco Santander reports (1)

mjwalshe (1680392) | about 2 months ago | (#47772815)

Some one told me that the reason Santander are so big in Spain was that the owners where very close with Franco and the regime and Spain did not issue any new banking licences for decades

Re:On Banco Santander reports (1)

Elementalor (551544) | about 2 months ago | (#47773051)

Not true. Santander began growing in 1999 after a merger with another two Spanish banks, Banco Central Hispanoamericano that were the product of another merger in 1991. Franco died in 1975 and there were dozens of banks and credit unions during his regime.

Come see a large bank being cheap (0)

Anonymous Coward | about 2 months ago | (#47772795)

I don't really mind them throwing this Out There, but given that they're a bank and habitually pay hand over fist for this sort of thing, a measly five kilobucks seems not really worth the trouble.

Re:Come see a large bank being cheap (1)

easyTree (1042254) | about 2 months ago | (#47773677)

Everybody tell us their best ideas on how we should do our jobs and one of you might win $5000 whilst we save millions. Yay \o/

Awesome. I'm surprised they didn't post a question on Slashdot!

Verdict (2)

marcello_dl (667940) | about 2 months ago | (#47772813)

"It's simple.
We kill the bitcoin."

I would be less concerned about BTC and more about cryptocurrencies in general. If people get used to that concept, using money as a totalitarian weapon and keeping the pretenses of democracy will be quite difficult.

Conclusions (4, Informative)

swb (14022) | about 2 months ago | (#47772845)

"In order to continue to maintain control over the economy and manipulate financial markets, banks will probably have to get some laws passed that give us control over bitcoin."

Conclusions: give us control over bitcoin (1)

JcMorin (930466) | about 2 months ago | (#47773149)

The good news is that bitcoin has been design so nobody can control it. Good luck with that banks!

Re:Conclusions: give us control over bitcoin (0)

Anonymous Coward | about 2 months ago | (#47773269)

The bad news is that bitcoin has been designed to be completely inflexible in the ever changing world of economy.

Other bad news is that its value still can be manipulated by any actor with sufficient funds.

FTFY.

BitCoin is a good challenger (1)

jones_supa (887896) | about 2 months ago | (#47772859)

When Linux started to become a bit "too good" on desktop, it forced Microsoft make Windows better, which lead to excellent Windows NT6. In the same way, BitCoin will challenge traditional money systems to improve.

Re:BitCoin is a good challenger (1)

qpqp (1969898) | about 2 months ago | (#47772923)

excellent Windows NT6

I see what you did there.

The RTM's build number had also jumped to 6000 to reflect Vista's internal version number, NT 6.0. [source [wikipedia.org] ]

Re:BitCoin is a good challenger (1)

jones_supa (887896) | about 2 months ago | (#47772955)

Yeah, Vista had a bit rough start. So?

Re: BitCoin is a good challenger (0)

Anonymous Coward | about 2 months ago | (#47773185)

Vista is still shit. At no point could it ever be described as excellent.

Re:BitCoin is a good challenger (1)

qpqp (1969898) | about 2 months ago | (#47781549)

rough start

You forgot the sarcasm tags, but don't worry, everyone got the joke anyway. ; )

Re:BitCoin is a good challenger (0)

Anonymous Coward | about 2 months ago | (#47772995)

Well first Bitcoin needs to not be utter shit.

Just like Linux ... (1)

aNonnyMouseCowered (2693969) | about 2 months ago | (#47773631)

Bitcoin has been forked many times over. There are probably as many Bitcoin derivatives as there as GNU/Linux distributions. So it's not exactly the Banks (Microsoft) vs. Bitcoin (Ubuntu?).

Carrying the analogy further, there's another cryptocurrency family that's like the BSD of the virtual currency world, CryptoNote (https://cryptonote.org/coins/). One interesting CryptoNote feature is teh use of multiple public addresses generated from the owner's wallet key, in contrast to Bitcoin, where each wallet consists of a single unique public address.

Re:Just like Linux ... (0)

Anonymous Coward | about 2 months ago | (#47775069)

Bitcoin has been forked many times over. There are probably as many Bitcoin derivatives as there as GNU/Linux distributions. So it's not exactly the Banks (Microsoft) vs. Bitcoin (Ubuntu?).

Carrying the analogy further, there's another cryptocurrency family that's like the BSD of the virtual currency world, CryptoNote (https://cryptonote.org/coins/). One interesting CryptoNote feature is teh use of multiple public addresses generated from the owner's wallet key, in contrast to Bitcoin, where each wallet consists of a single unique public address.

WTF are you saying? Go read how wallets work, there is no such thing as an address: you simply prove you can solve a script to claim an output, and that is called address, and there can be an infinite amount per each wallet

Human-readable translation: (3, Insightful)

carlhaagen (1021273) | about 2 months ago | (#47772869)

They are looking into the best course of action to have cryptocurrencies banned as it threatens their paychecks and their control over people's money.

Why bother? (1)

jbmartin6 (1232050) | about 2 months ago | (#47773237)

I don't see why they would bother. According to many of the folks here on /. Bitcoin is just a Ponzi scheme and it is sure to collapse any time now.

Re:Why bother? (0)

Anonymous Coward | about 2 months ago | (#47775447)

And you don't see why anyone would want to investigate or shut down a large pyramid scheme?

A course of action? (0)

Anonymous Coward | about 2 months ago | (#47773369)

To do what exactly, sabotage it?!

ponzi pyramid of tulip bulbs (0)

Anonymous Coward | about 2 months ago | (#47773719)

Interesting that so many banks and governments are taking this so seriously ... after all its just a ponzi scheme, or a pile of tulip bulbs.

top tier consulting firms (1)

Thorsten Hirsch (3702739) | about 2 months ago | (#47777269)

> While acquiring consulting services from top tier consulting firms can be exciting, he thought that an outsider,
> multidisciplinary perspective, would be particularly helpful.

Bad news for top tier consulting firms: Santander found out that yegii is much cheaper than top tier consulting firms while both are just using Google to create their studies.
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