2 ms·

We are talking about totally different things, and I have absolutely no issue with fractional reserve banking and have no conspiracy laden issue or understandin

We are talking about totally different things, and I have absolutely no issue with fractional reserve banking and have no conspiracy laden issue or understanding of it. What you mentioned happens. And requires a charter from governments to occur. What I mentioned happens too. And simply relies on the tolerance of the market. One is about banks. Another is about the amount of unsecured leverage that all individuals and entities can operate with, and whether their counterparties need disclosure or not. “Fractional reserve” in this context, is more about the ratio of collateral, used colloquially for quicker understanding. “Loan to value” could be helpful for other people to understand. “margin requirements” for other people. I am only referencing the reality that individuals, businesses, and almost any kind of entity, can have a lower value of assets redeemeable for any liability they issue or accrue. It can be a “fraction” or their “reserves”.

arcticbull 5y ago
The "charter of the government" is the difference between kidnapping and an arrest. We've long since given up on the idea that anyone should be able to do whatever they want no matter who it harms.
- vmception 5y ago
  Many financial infractions operate in a different reality that has no analogy to non-financial criminal law. You are focusing far too much on the marketing that uses the terms currency. Any individual or corporation is capable of creating a product said to be redeemable for something in their treasury. This has nothing to do with the parallels to the federal reserve when corporation calls its product a stablecoin or dollar-like. All settlements with Tether's companies have been exclusively related to the reality that the corporation's product was not in fact redeemable for the thing they said it was. That is the only issue, every authority that matters has said that was the only issue. Both crypto twitter as well as blockchain skeptic's opinion doesn't matter here. Their armchair legal analysis don't matter. Their comparisons to the state-monopoly on currency issuance doesn't matter. The corporation having marketing and legal agreements that accurately describe what their product can be redeemed for, if anything at all, simply has to be congruent with reality. That's the totality of the sanction from the CFTC, and the same with the NYAG at one state level. But I will give you one bone, and that's the reality that the DOJ can of course come with a parallel criminal prosecution for the same activity. So if that will validate your thoughts on anything, just wait for that if it ever comes. I'm not worried about "being right", only saying what this settlement is saying.

arcticbull 5y ago

The "charter of the government" is the difference between kidnapping and an arrest. We've long since given up on the idea that anyone should be able to do whatever they want no matter who it harms.

vmception 5y ago
Many financial infractions operate in a different reality that has no analogy to non-financial criminal law. You are focusing far too much on the marketing that uses the terms currency. Any individual or corporation is capable of creating a product said to be redeemable for something in their treasury. This has nothing to do with the parallels to the federal reserve when corporation calls its product a stablecoin or dollar-like. All settlements with Tether's companies have been exclusively related to the reality that the corporation's product was not in fact redeemable for the thing they said it was. That is the only issue, every authority that matters has said that was the only issue. Both crypto twitter as well as blockchain skeptic's opinion doesn't matter here. Their armchair legal analysis don't matter. Their comparisons to the state-monopoly on currency issuance doesn't matter. The corporation having marketing and legal agreements that accurately describe what their product can be redeemed for, if anything at all, simply has to be congruent with reality. That's the totality of the sanction from the CFTC, and the same with the NYAG at one state level. But I will give you one bone, and that's the reality that the DOJ can of course come with a parallel criminal prosecution for the same activity. So if that will validate your thoughts on anything, just wait for that if it ever comes. I'm not worried about "being right", only saying what this settlement is saying.