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Or more specifically "what if a run on USDC causes Standard Bank of New York to collapse?" The bank is part of the legitimate, regulated economy. The regulators
by NelsonMinar 4y ago
Or more specifically "what if a run on USDC causes Standard Bank of New York to collapse?" The bank is part of the legitimate, regulated economy. The regulators should be insulating the real economy from cryptocurrency scams and gambling.
- woah 4y agoIf people wanted to get their money out and SBNY had somehow misplaced it, it would seem like the “scam” was the “legitimate, regulated” SBNY, not “cryptocurrency”
- FabHK 4y agoIn the good old regulated economy, individual depositors of a bank are protected by the FDIC (up to a certain level), and have no reason to engage in a bank run. Now, if all those individual depositors instead give their money to some unregulated entity (USDC), and that unregulated entity gives $50 bn to a bank, and then one day turns around and says to the bank "hey, I'd like my $50 bn back", then the bank might not have that much at hand right now. And since the unregulated entity is not covered by the FDIC, individual investors might have an incentive to engage in a bank run.
- deleted 4y ago[deleted]