5 ms·

> hold some cash and hold some US treasuries. Pocket the interest. Become rich. Not getting what you're saying here: Only banks should have that privilege?

dfdaffg423rag 4y ago
I'm saying, if you're making a US dollar backed stablecoin, you could do it with minimal risk and still profit handsomely by just holding US treasuries. Instead, we have stablecoins backed by all sorts of things like commercial paper in cryptocurrency exchanges.
- namdnay 4y ago
  Who is going to put their money in a stable coin paying 0.2% interest when the guy next door is offering 20%? Answer:anyone sane, but they wouldn’t be there in the first place
JumpCrisscross 4y ago
> Only banks should have that privilege? Yes, in exchange for the privilege of money creation you need tight regulations and public disclosures. Banking left unregulated turns into this mess time and time again. You'd think people would be more disciplined about betting private money creators. But they aren't. They never are. Particularly not when their neighbor is showing orders of magnitudes of paper gains. This was true in antiquity. It was true in our era of free banking. It's proven true, again, in crypto.
- jpmattia 4y ago
  > Banking left unregulated turns into this mess time and time again. And yet, regulated banking also turns into a mess time and time again.
  - deleted 4y ago
    [deleted]
  - threeseed 4y ago
    Depends on your country. In Australia, our banks are among the most regulated and survived through the GFC with barely a scratch. Regulation is proven to work in the financial system. You just need to make sure you have enough of it which often the US hasn't. But in recent years that has been fixed up. Also it's a false comparison. There is one Tether and tens of thousands of banks.
  - vkou 4y ago
    Into a mess for who? Depositors? Could you summarize how much money depositors across the entire United States lost to bank busts over the past, say 40 years? And how does it stand up, compared to the crypto-of-the-month scams, losses, and exchange busts?
    - jpmattia 4y ago
      > Could you summarize how much money depositors across the entire United States lost to bank busts over the past, say 40 years? Nominal or actual? Just the Federal Savings and Loan crisis + the TARP bailouts were billions from the dilution of dollars. And that's just the US.
      - vkou 4y ago
        The FSL crisis was caused by wild-west deregulation, accounting practices which have since been banned, and resulted in a thousand convictions. The crypto space is repeating all the same bullet points, except with more outright fraud, with less accounting, and without any convictions.
        jpmattia 4y ago
        > The FSL crisis was caused by wild-west deregulation, accounting practices which have since been banned, and resulted in a thousand convictions. I'm guessing you did not live through it: Like 2008, there were many causes. See eg the wiki: https://en.wikipedia.org/wiki/Savings_and_loan_crisis#Causes https://en.wikipedia.org/wiki/Savings_and_loan_crisis#Causes But you also missed the heart of the matter: Money that was lost in the US, despite it having a regulated banking system.
        JumpCrisscross 4y ago
        > was lost in the US, despite it having a regulated banking system This is a straw man. Nobody claimed nobody in a regulated system ever loses money.

dfdaffg423rag 4y ago

I'm saying, if you're making a US dollar backed stablecoin, you could do it with minimal risk and still profit handsomely by just holding US treasuries. Instead, we have stablecoins backed by all sorts of things like commercial paper in cryptocurrency exchanges.

namdnay 4y ago
Who is going to put their money in a stable coin paying 0.2% interest when the guy next door is offering 20%? Answer:anyone sane, but they wouldn’t be there in the first place

JumpCrisscross 4y ago

> Only banks should have that privilege? Yes, in exchange for the privilege of money creation you need tight regulations and public disclosures. Banking left unregulated turns into this mess time and time again. You'd think people would be more disciplined about betting private money creators. But they aren't. They never are. Particularly not when their neighbor is showing orders of magnitudes of paper gains. This was true in antiquity. It was true in our era of free banking. It's proven true, again, in crypto.

jpmattia 4y ago
> Banking left unregulated turns into this mess time and time again. And yet, regulated banking also turns into a mess time and time again.
- deleted 4y ago
  [deleted]
- threeseed 4y ago
  Depends on your country. In Australia, our banks are among the most regulated and survived through the GFC with barely a scratch. Regulation is proven to work in the financial system. You just need to make sure you have enough of it which often the US hasn't. But in recent years that has been fixed up. Also it's a false comparison. There is one Tether and tens of thousands of banks.
- vkou 4y ago
  Into a mess for who? Depositors? Could you summarize how much money depositors across the entire United States lost to bank busts over the past, say 40 years? And how does it stand up, compared to the crypto-of-the-month scams, losses, and exchange busts?
  - jpmattia 4y ago
    > Could you summarize how much money depositors across the entire United States lost to bank busts over the past, say 40 years? Nominal or actual? Just the Federal Savings and Loan crisis + the TARP bailouts were billions from the dilution of dollars. And that's just the US.
    - vkou 4y ago
      The FSL crisis was caused by wild-west deregulation, accounting practices which have since been banned, and resulted in a thousand convictions. The crypto space is repeating all the same bullet points, except with more outright fraud, with less accounting, and without any convictions.
      - jpmattia 4y ago
        > The FSL crisis was caused by wild-west deregulation, accounting practices which have since been banned, and resulted in a thousand convictions. I'm guessing you did not live through it: Like 2008, there were many causes. See eg the wiki: https://en.wikipedia.org/wiki/Savings_and_loan_crisis#Causes https://en.wikipedia.org/wiki/Savings_and_loan_crisis#Causes But you also missed the heart of the matter: Money that was lost in the US, despite it having a regulated banking system.
        JumpCrisscross 4y ago
        > was lost in the US, despite it having a regulated banking system This is a straw man. Nobody claimed nobody in a regulated system ever loses money.