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RE: Banks ban credit crypto purchases, and that is good news.
I don't believe that banks are banning credit cards for crypto as a protection for consumers, but more so a protection for the banks. If they have a large amount of customers purchasing crypto on credit cards, and crypto tanks, the banks will have to deal with potentially a large number of defaults.
I did see that the big banks are now treating it as a cash advance and charging those interest and fees.
I was not suggesting they were doing it to protect their customers, I was suggesting they will spin it that way.
If the banks were looking at this from a short term perspective, the thing to do would be simply make the change from a purchase to an advance. They get the fee and a sinful amount of interest. This could be a huge money maker for them. The FOMO would cause many consumers to overlook the usury and charge charge charge! Most consumers would have enough income or do well enough in crypto to pay the cards. Individuals who get over their heads could be dealt with on a case by case basis.
I simply believe the primary reason the banks are taking this action is they want to do everything they can to kill crypto. Blockchain in the hands of the banks is another thing, but Bitcoin and it's ilk are clearly their competition. The goal is to kill cryptos without giving them any credibility.
If the headline in the Wall Street Journal tomorrow is. "BIG BANKS ARE TERRIFIED OF BITCOIN PUTTING THEM OUT OF BUSINESS" I think that would be a huge "buy signal".
I was agreeing with you in that the banks motives were not first to protect customers is what I meant.
What is also interesting is that many crypto lovers are currently " all in". Even if they normally would think that buying crypto with a credit card was reckless, they might now look at these "bargain prices" as worth the risk.
The problem is that bottom may be a lot lower than most of us think. It actually could create a big problem if folks took their credit cards to the limits at 8K just to watch it fall to 4k. Especially if it does not bounce back for a few months.
I think there is going to be a lot of FUD (some of it real) in the next few months, much of it generate by or for the banks. If you already have the negative news stories on the cutting board and are just waiting to publish them, you would be a fool to lend money to the same people you are trying to break. You either fuel the market by giving it liquidity or you create a large number of customers who at worst will not be able to pay you back and at best will simply stop using the cards cause they can't afford to borrow any more.
What a coincidence, they more or less independently decided to do this at the same time. :)