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They aren't a bank Laws don't function on what you think is equivalent Banks are a lot more than "I will hold your money" Your mattress is also not a bank

salawat 4y ago
Correct. My mattress does not surveil my financial activity to the Government, or operate as an extension of law enforcement. Nor does it act as a form of power projection by being something to which access to it is centrally controlled for the sake of sanctions.
- JumpCrisscross 4y ago
  Your mattress is also a better investment than practically anything in crypto.
pjc50 4y ago
Broadly any organisation which most of its business is taking deposits on a short term basis and lending them out on longer, fixed terms can be deemed a "bank" and analysed as such, including the vulnerability to bank runs which has taken out this and other crypto firms. It's not a regulated bank, and it may be illegal for it to call itself a bank, hence it's a wildcat or shadow bank. But the business is definitely bank-shaped.
- JetSpiegel 4y ago
  But a real bank is FDIC insured, so the "value" of deposits never goes to 0, unlike "wildcat banks". Unless the central bank can't print more money, and that will never happen by definition.
- JohnHaugeland 4y ago
  > Broadly any organisation which most of its business is taking deposits on a short term basis and lending them out on longer, fixed terms can be deemed a "bank" and analysed as such uh. no, it really can't. you can't even do this with a credit union. if you think the major purpose of a bank is to store deposits, you don't understand what banks are. . > But the business is definitely bank-shaped. holding deposits is not "being bank shaped" many, many things in our society hold desposits, from insurance companies to blue chips, to stocks and investments, from annuities to rollovers, from awards to grants, from credit accounts to coupons, and even the local layaway none of them are even slightly banks the purpose of a bank is to give certainty by being bound to specific laws i know, when i put my money in a bank, that it won't be invested by the bank in specific dangerous ways. i do not know that with a credit union. i definitely do not know that with some coin dot com that you imagine to be bank shaped. this post is about coin holders learning one of the many differences many banks - more than half - don't take deposits at all this is a deep failure to grasp what a bank is, and why this isn't a bank the crypto community is about to start learning about bank bindings around leverage that emerged in the 1920s afterwards they're going to learn about floor limits that were set on actual banks in the 1930s, and why after that, they're going to learn about the fdic, and that it doesn't apply to things that fans believe are "bank shaped"

salawat 4y ago

Correct. My mattress does not surveil my financial activity to the Government, or operate as an extension of law enforcement. Nor does it act as a form of power projection by being something to which access to it is centrally controlled for the sake of sanctions.

JumpCrisscross 4y ago
Your mattress is also a better investment than practically anything in crypto.

pjc50 4y ago

Broadly any organisation which most of its business is taking deposits on a short term basis and lending them out on longer, fixed terms can be deemed a "bank" and analysed as such, including the vulnerability to bank runs which has taken out this and other crypto firms. It's not a regulated bank, and it may be illegal for it to call itself a bank, hence it's a wildcat or shadow bank. But the business is definitely bank-shaped.

JetSpiegel 4y ago
But a real bank is FDIC insured, so the "value" of deposits never goes to 0, unlike "wildcat banks". Unless the central bank can't print more money, and that will never happen by definition.
JohnHaugeland 4y ago
> Broadly any organisation which most of its business is taking deposits on a short term basis and lending them out on longer, fixed terms can be deemed a "bank" and analysed as such uh. no, it really can't. you can't even do this with a credit union. if you think the major purpose of a bank is to store deposits, you don't understand what banks are. . > But the business is definitely bank-shaped. holding deposits is not "being bank shaped" many, many things in our society hold desposits, from insurance companies to blue chips, to stocks and investments, from annuities to rollovers, from awards to grants, from credit accounts to coupons, and even the local layaway none of them are even slightly banks the purpose of a bank is to give certainty by being bound to specific laws i know, when i put my money in a bank, that it won't be invested by the bank in specific dangerous ways. i do not know that with a credit union. i definitely do not know that with some coin dot com that you imagine to be bank shaped. this post is about coin holders learning one of the many differences many banks - more than half - don't take deposits at all this is a deep failure to grasp what a bank is, and why this isn't a bank the crypto community is about to start learning about bank bindings around leverage that emerged in the 1920s afterwards they're going to learn about floor limits that were set on actual banks in the 1930s, and why after that, they're going to learn about the fdic, and that it doesn't apply to things that fans believe are "bank shaped"