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That is impossible: the numbers on your bankaccount are multiplied, thanks to fractional reserve. The cash in your hand is not. Maybe not a big deal now, but at
by koonsolo 5y ago
That is impossible: the numbers on your bankaccount are multiplied, thanks to fractional reserve. The cash in your hand is not. Maybe not a big deal now, but at some point it might be. And then it's "surprise! The numbers on your account != cash in your hand"
- __alexs 5y agoHow do I put bitcoins in my hand? Sounds painful.
- koonsolo 5y agoYou can put them in your head. Painful when you try it with cash or coins :D
- bhouston 5y agoBut we have insurance on deposits in the US/Canada. Also DAO are trying to replicate fraction reserve lending. So basically we have protections against this problem in the traditional system and the crypto system is trying to replicate fractional reserves. Tether also is engaging in massive fractional reserve lending. Apparently only 3% of Tethers are backed by cash holdings: https://news.ycombinator.com/item?id=27151370 https://news.ycombinator.com/item?id=27151370
- koonsolo 5y ago> the crypto system is trying to replicate fractional reserves. That is not a fair statement and you know it. Only a fraction of cryptos maybe. Most do not.