It's pretty simple really. The price would drop precipitously and start a selling frenzy as people try to preserve their investment. Unlike the exchanges, you

It's pretty simple really. The price would drop precipitously and start a selling frenzy as people try to preserve their investment. Unlike the exchanges, you can't close down Bitcoin if there's a run on the "bank," And unlike the banks, Bitcoin could only recover based purely on market forces. Well, to be sure, various governments could step in to control the cash exchanges, but that is far more difficult with e-coins. It would actually be fascinating to watch (from my perspective), because without the possibility of central banks or governments stepping in to control the bleeding, we would see what an entirely unregulated market would do in such a circumstance. It would certainly give the economics PHDs something to write about.