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I think by "vulnerable to fractional reserve," he means that since there is no way to transparently verify or audit their USD reserves, they could run a fractio

I think by "vulnerable to fractional reserve," he means that since there is no way to transparently verify or audit their USD reserves, they could run a fractional system while claiming to be fully backed, like Mt Gox did.

tomjakubowski 8y ago
Ah. I guess that my reading was "vulnerable to [bank runs, due to] fractional reserve."