That's my understanding, too. On some (most?) exchanges, you're not really buying Bitcoin, you're buying a balance on that exchange - a right to withdraw or tra

That's my understanding, too. On some (most?) exchanges, you're not really buying Bitcoin, you're buying a balance on that exchange - a right to withdraw or transact BTC at moment's notice. Given the amount of shady practices, it wouldn't surprise me if some exchanges operated on fractional reserves, being vulnerable to bank runs, a practice that many BTC adherents decry the traditional banking sector for.