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Yes, if people accept fractional reserve banking for bitcoin. I'd actually assume that's how most exchanges operate under the hood but many people who buy into
by throwawayReply 9y ago
Yes, if people accept fractional reserve banking for bitcoin. I'd actually assume that's how most exchanges operate under the hood but many people who buy into bitcoin for ideological reasons won't accept that.
A consequence of making that formal is that the total owned amount of bitcoin would be more than 21m, because the hacker would own bitcoin and the users would own bitcoin on the exchange.
As long as there isn't a bank run, that discrepancy would not be a problem, but it would deflate the currency, also seen as unacceptable to bitcoin purists.
edit: access -> accept.
- notyourday 9y agoOh, rubbish. Bitcoin is fundamentally incompatible with sanity and a rule of law ( which is what is needed for regulation ). If I were to start a bitcoin exchange ( and myself and those that I know have way more technical abilities to actually pull it off ) and apply sane KYC and risk mitigation strategies, the crypto-nutcases would be screaming like banshees that the exchange is not acting in a "spirit" of bitcoin which is: 1) Allow anyone to launder money/coins 2) Ask no questions 3) Make all transactions irreversible (i.e. do not follow 'in the name of' ledger ) 4) Demand no validated tax information (i.e. leverage power of the government to make players play by the rules )