> In comparison, very few people distinguish paper cash money from a bank credit backed by a fractional reserve. I would add the words "in the modern era". My

> In comparison, very few people distinguish paper cash money from a bank credit backed by a fractional reserve. I would add the words "in the modern era". My grandparents generation regarded those two as very different, having lived through the bank runs of the depression. The difference between their gen and mine is due to the advent of the FDIC. This would also address your point about Mt Gox: Had there been insurance, Mt Gox would not have been such a clusterfk. So no surprise: Coinbase and Bakkt both tout the insurance of their holdings. It's not quite FDIC levels (ie, a defacto government backing) but it's getting closer. As a consequence, it is not too hard for me to imagine a time that custodial accounts will have nearly the same confidence as a private wallet, because the equivalent of FDIC will likely be created by bitcoin-based institutions.