Why I trust the bank and not Bitcoin or any other cryptocurrency? Simple! Origin’s traceable trail! What do I mean by this? The time you deposit your money into the bank either through electronic means such as mobile or you could deposit your money in person, a third party, in this case, the bank is there to take the responsibility of safekeeping your money. Sure, the bank could have a system hiccup where your bank account would show up with a wrong value, but the bank has the responsibility to generate other traceable trails of your money such as paper statement, online bank statement and so forth. Bitcoin or any other cryptocurrency is a different matter because there is no third party that is responsible for your money! When something goes wrong with your electronic wallet such as corruptive memory on your device would destroy everything you store! Cryptocurrency exchanges could be the third party to be responsible for your crypto coins, but these are new institutions that you could not trust and they got hacked too often!
In China, people are going cashless by using their mobile phone as the main medium to pay for things. Still, their digital currency in their electronic wallet is tied to a medium of cash and a whole lot of other mediums such as check and so forth that could eventually generate into very noticeable trails of origin. With such noticeable trails of origin, the owner of the money could always demand some sort of compensation when everything goes wrong such as the value of money is suddenly being misreported somehow. These people, although in cashless society (almost), would be able to morph their medium of payment effortlessly — cash to check to digital numbers on their mobile to whatnot — with some sort of confidence that some sort of traceable trails of origin would back their transaction up clearly.
Although cryptocurrency’s blockchain is very rigid and vivid in showing transaction trails, the sender and receiver of the crypto-coins could hide behind the transaction which in the end could hurt their claim of the transaction. What’s worse is that they could face a perfect storm when their device got corrupted or hacked and their wallet somehow was rendered broken — they won’t be able to open their wallet to show that they got the traceable trail of origin to back up their transactional claim so they could receive any compensation from whatever party that they’d dealt with. As of now though, even if they’re proving that they’re the owner of a crypto wallet that sent out the crypto-coins, they mostly like are going to face anger and confusion as once the crypto-coins leave their wallet — these crypto-coins are gone forever and nobody would be able to compensate for the lost crypto-coins.
I think until the cryptocurrency tech could address the worries and weaknesses of the transactions that are being made by the blockchain and the frontend technology such as the cryptocurrency tech (e.g., Bitcoin, Litecoin, Namecoin) itself, nobody could fully feel comfortable of using such tech as a replacement for traditional forms of currencies. I hate the feeling of being a broken record, but let’s be clear cryptocurrencies are facing real hurdles such as hackable, not widely acceptable, not being supported by the governments, relying too much on an electronic wallet as the trail of origin, facing corruptable electronic memory (i.e., RAM/hard-drive), no mean of compensation once crypto-coins got loose from the crypto-wallet, too much saturation as too many cryptocurrencies are in the existence, and so forth.
One more thing! If someone stole the medium that you store your crypto-coins on such as your smartphone, you will never get these crypto-coins back! Traditional forms of money such as the digital numbers that represent the dollar amount you got in your smartphone app would still be yours if your smartphone got stolen! After all, the app on your smartphone is probably connected to your bank account and the app could once again be re-download and reconnected to your bank account. Perhaps, you’re using an app such as Starbucks app which requires you to preload the number of dollars before you could use it to pay for coffee — even a stolen mobile phone won’t be a problem since you could always re-download Starbucks app and reconnect to Starbucks’ server which got the proper dollar amount in your Starbucks account as before! Crypto-wallet? I don’t think so!