Banking Without Banks: The Rise of DeFi and Self-Banking
- Èric Lluch
- Aug 24
- 3 min read
Disclaimer: This article is for educational purposes only and does not represent financial advice. I’m sharing my personal interpretation of trends in banking, DeFi, and self-financing. Please do your own research and consult licensed professionals when making financial decisions.
Why “Banking Without Banks” Matters in 2025
Do you really need a bank to manage your money?
For decades, the answer was an unquestionable “Yes.” But today, thanks to DeFi (Decentralized Finance) and self-banking strategies, the answer can be a confident: “Not anymore.”
Across Europe and beyond, more people are asking:
How can I transfer money globally without being charged €30 fees?
What if my bank shuts down my account or freezes funds?
Is there a way to save and invest without depending on banks?
The answer is yes. And it’s already happening.
What Does It Mean to “Be Your Own Bank” or “Build Your Own Bank”?
To be your own bank means taking control of the essential services banks normally provide, but without needing a bank.
Instead of:
A checking account ➝ you use a crypto wallet or a crypto exchange.
A savings account ➝ you use stablecoins or ETFs
International transfers ➝ you use blockchain payments. Some cryptocurrencies allow transfers for 0€ to everywhere in the world, for example when using XRP.
Loans ➝ you access DeFi lending platforms
This doesn’t mean living 100% outside the system because you still need to get your payslip paid, which is typically paid in FIAT (Euros, dollars, etc.). But it does mean reducing dependency on traditional institutions and giving yourself more control, flexibility, and freedom.
📌 You might also enjoy: FIRE for Millennials & Gen Z — a practical strategy for financial independence without relying on traditional banks.
💳 Traditional Banks vs. DeFi vs. Hybrid Models
Service | Traditional Bank | DeFi / Self-Banking | Hybrid (Best of Both) |
Payments | Slow, fees | Fast, cheap, global | Fintech + Crypto card |
Savings | 0.1–2% APY | 4–12% (stablecoins) | ETFs + DeFi |
Accessibility | Limited by KYC | Borderless, 24/7 | Easy apps (Revolut, N26) |
Risk | Low, insured | Moderate-high (volatility, hacks) | Balanced approach |
Key takeaway: You don’t need to choose one. Many people combine crypto wallets, ETFs, and fintech banks to stay flexible. Actually that’s what I do. I combine Revolut, N26 and crypto exchanges while buying a consistent monthly amount on ETFs.
3 Pillars of Self-Banking
1. Crypto Wallets (Your New Checking Account)
A self-custody wallet (Ledger, MetaMask, or mobile wallet) lets you hold and send money without a bank.
Fast & borderless transfers
Total ownership of your assets
Risk: losing private keys = losing access
👉 Learn more: Bitcoin Strategy: Why DCA Still Works.
2. Stablecoins & ETFs (Your New Savings Account)
Why keep money in a bank at 1% interest when you can earn more?
Stablecoins (USDC, DAI): Earn yield in DeFi or CeFi platforms.
ETFs: A safer, long-term wealth-building option with low fees.
3. DeFi Lending & Passive Income (Your New “Bank Services”)
Platforms like Binance, Aave, Compound, and Lido allow you to:
Lend crypto for interest
Borrow against your assets (without selling)
Stake ETH or other tokens
Warning: DeFi carries real risks (smart contract hacks, rug pulls). Always diversify and never put in money you can’t afford to lose.
Risks & Rewards of Banking Without Banks
Rewards:
True financial independence. You choose exactly how to deal with your money, how to transfer it, etc.
Global accessibility. You have access to your money 24/7, nothing about not working on the weekends, etc.
Potentially higher returns: this is typically associated with higher risk and that’s not an exception. Even with stablecoins you can get returns of up to 16% annually. You can check my guide on stablecoins for this, which has been the most seen post of BYOBanking so far.
Risks:
No insurance if things go wrong. In Europe, there are regulations that ensure that almost any bank would cover your first 100k€, even if the bank gets bankrupt.This is not the case for crypto.
Regulatory uncertainty
High learning curve
That’s why the hybrid model (mix of ETFs, DeFi, and fintech banks) is the most realistic option for most people.
Final Thoughts: The Future of Self-Banking
Traditional banks won’t disappear tomorrow: but the way we think about money is already changing.
To “be your own bank” means:
You rely less on old institutions
You combine the best tools available today (crypto + ETFs + fintech)
You take responsibility for your financial future
And that’s exactly what BYO Banking is about.
Free Resources (subscribe for more ;))
“10 Steps to Start Being Your Own Bank in 2025”
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