To remain consistent, opponents of so-called fractional-reserve banking have to denounce overbooking practices among airlines as well as the entire business of insurance.
Bankers have been steadily introducing cashless banks over the last few years in response to falling customer demand for cash. With fewer people wanting to withdraw or deposit cash, the cost of offering these services gets harder to justify to shareholders.
Complaining about injustice is cheap; bona fide progressives put their money where their ideals are, and reap as they sow.
The knowledge required to maintain monetary equilibrium is tacit and dispersed. No centralized monetary system, no matter how smart or well-intentioned its leaders, has access to that knowledge.
Fintech solutions are here to stay, whether banks want them or not. They shouldn't forget that while banking is necessary, banks are not.
The future has a lot of potential awe-inspiring inventions coming down the pipeline. But while daydreaming about these, we shouldn’t forget to be in awe of the invention of fractional-reserve banking. Long before fancy apps, and indeed long before the internet even, it was solving our problems and making our lives better.
Cryptocurrencies are still quite new and seem to just be scratching the surface of their potential. If they are to succeed — not only as a fringe medium of exchange or speculative investment, but as real competitors with government currencies — some new programmers are going to have to come along and make currencies whose digital coins are created in a much different manner than the current ones. Perhaps digital coins whose supply is determined by demand will lower volatility enough to cut the future uncertainty of prices. Those may be adopted as true media of exchange. Until that time, Hayek’s vision of private currencies will not be quite realized.