The Business of Check Cashing

millions and millions of people own U.S. dollars, which means precisely that some bank has a list and there is an entry for them on that list. It’s probably not in Excel, but same basic idea: The bank has a list of dollars in its accounts, the list is not kept via any sort of consensus mechanism or blockchain or whatever; the bank just keeps the li... See more

Financial markets, the banking system, the insurance industry, and securities and corporate regulations, all grew in prominence during this era. These institutions were really good at producing trust. Trust became a saleable good and trust production became a big business.

This new way of winning distribution is quite different from the old way. Yes it’s also capital intensive, but you’re not buying real estate. You have low fixed costs, and variable costs that scale with usage (vs. real estate servicing that you pay regardless of use). And where branch-banking might have had winner-take-all dynamic regionally, there... See more