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Yes, my poetic license path is very heavy withdrawals -> bank run -> dire straits (money for nothing pun). $60B in assets, $8B in withdrawals. Even if all the

Yes, my poetic license path is very heavy withdrawals -> bank run -> dire straits (money for nothing pun). $60B in assets, $8B in withdrawals. Even if all the assets are correctly valued, I don't anyone would envy their position. But given their own coin in holding in there, maybe they are devoting some money to defend it, or maybe they are actually in decent shape and can handle this quasi bank run. More succinctly, if they were really toast, then $BNB would be cratering. Given it's holding in there, it seems they are OK (at this very instant in time).

europeanguy 4y ago
> if they were really toast, then $BNB would be cratering Why exactly, though? That's what I'm asking. I promise I'm not trolling, I just don't understand the connection.
- funstuff007 4y ago
  My presumption is Binance is the buyer of last resort for $BNB.
- crtified 4y ago
  Well it has lost about one quarter of it's value VS Bitcoin in the past 3 weeks. Whether or not that fits the definition of cratering is up to the individual. 27 Nov: 1 BNB = 0.0188 Bitcoin; 17 Dec: 1 BNB = 0.0142 Bitcoin
ineedasername 4y ago
Collapses often happen very gradually (in a time span relative the the majority proportion of the collapse) and then all at once. As such, its failure to collapse as the crisis continues is not strong evidence that it’s not toast. Consider the examples of any system subject to cascading failures. But neither is there sufficient evidence to determine if it’s in the early stages of a death spiral. What seems clear to me is that it’s unlikely to improve in value in the very short term, and might indeed collapse, so it could be prudent to transfer assets out while there’s still liquidity to do so especially in light of recent collapses. Of course this has the downside of accelerating or even making a collapse a self-fulfilling prophesy: that’s inherent to the nature of any asset where user confidence is a tent pole of stability. It is also why traditional finance has evolved mechanisms to have lenders of last resort so that there is no death-spiraling perverse incentive to get your money out early in those situations. But that sort of back stop takes truly massive resources that need to dwarf those of the potentially failing organizations, which is why you see nation-states filling the role. It may take a nation issuing debt against the guarantee assets of a $trillion+ GDP (and really the taxation ability that comes with, though even that oversimplifies things…) in order to back stop and perform that role for organizations on the scale of many $Billions.

europeanguy 4y ago

> if they were really toast, then $BNB would be cratering Why exactly, though? That's what I'm asking. I promise I'm not trolling, I just don't understand the connection.

funstuff007 4y ago
My presumption is Binance is the buyer of last resort for $BNB.
crtified 4y ago
Well it has lost about one quarter of it's value VS Bitcoin in the past 3 weeks. Whether or not that fits the definition of cratering is up to the individual. 27 Nov: 1 BNB = 0.0188 Bitcoin; 17 Dec: 1 BNB = 0.0142 Bitcoin

ineedasername 4y ago

Collapses often happen very gradually (in a time span relative the the majority proportion of the collapse) and then all at once. As such, its failure to collapse as the crisis continues is not strong evidence that it’s not toast. Consider the examples of any system subject to cascading failures. But neither is there sufficient evidence to determine if it’s in the early stages of a death spiral. What seems clear to me is that it’s unlikely to improve in value in the very short term, and might indeed collapse, so it could be prudent to transfer assets out while there’s still liquidity to do so especially in light of recent collapses. Of course this has the downside of accelerating or even making a collapse a self-fulfilling prophesy: that’s inherent to the nature of any asset where user confidence is a tent pole of stability. It is also why traditional finance has evolved mechanisms to have lenders of last resort so that there is no death-spiraling perverse incentive to get your money out early in those situations. But that sort of back stop takes truly massive resources that need to dwarf those of the potentially failing organizations, which is why you see nation-states filling the role. It may take a nation issuing debt against the guarantee assets of a $trillion+ GDP (and really the taxation ability that comes with, though even that oversimplifies things…) in order to back stop and perform that role for organizations on the scale of many $Billions.