4 ms·

False. Money on your bank account is backed by bank's assets, not by the central regulator. Recommended reading: https://en.wikipedia.org/wiki/Fractional-reserv

False. Money on your bank account is backed by bank's assets, not by the central regulator. Recommended reading: https://en.wikipedia.org/wiki/Fractional-reserve_banking https://en.wikipedia.org/wiki/Fractional-reserve_banking , M1 money supply, etc. > The only way to bring stability to the bizarro world of crypto is by tying it to "fiat" False. It's possible to make stable-coins using just price oracle and collateral. "Fiat" is not necessary. E.g. https://www.liquity.org/bold https://www.liquity.org/bold

bryant 2y ago
> False. Money on your bank account is backed by bank's assets, not by the central regulator. Recommended reading: https://en.wikipedia.org/wiki/Fractional-reserve_banking https://en.wikipedia.org/wiki/Fractional-reserve_banking , M1 money supply, etc. You didn't even finish reading the first paragraph. > Bank reserves are held as cash in the bank or as balances in the bank's account at the central bank The collapse of svb shows how much the central regulator cares about making sure the entire banking system doesn't fall apart, too. With the way you remarked "false" at the OP, though, I don't expect you're here for an engaging and educational discussion, so I'll leave it here. lol
jqpabc123 2y ago
It's possible to make stable-coins using just price oracle and collateral. Most attempts at "algorithmic" stable coins have failed. See TerraDollar, Luna and Titan.
- killerstorm 2y ago
  Over-collateralized stables are different from "algorithmic": the algorithmic ones are not fully backed by reserves.
  - rafale 2y ago
    They are very capital inefficient and still can fail during black swan events.
  - jqpabc123 2y ago
    the algorithmic ones are not fully backed by reserves. And you just know that the "collaterized" ones are? In most cases, their books aren't open. And they wouldn't lie about this would they? In some strange way, the crypto brain has been programmed to ignore the obvious with a hand wave and just accept all the chicanery that is crypto.
    - killerstorm 2y ago
      I gave you Liquity as an example. They don't have "books", it's a smart contract which takes ETH as a collateral and lets ppl to borrow LUSD against it. Maker initially worked same way, but eventually they started accepting off-chain collateral.
PhilipRoman 2y ago
Regarding fractional reserves... https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm https://www.federalreserve.gov/newsevents/pressreleases/mone... >the Board has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period. This action eliminates reserve requirements for thousands of depository institutions and will help to support lending to households and businesses.

bryant 2y ago

> False. Money on your bank account is backed by bank's assets, not by the central regulator. Recommended reading: https://en.wikipedia.org/wiki/Fractional-reserve_banking https://en.wikipedia.org/wiki/Fractional-reserve_banking , M1 money supply, etc. You didn't even finish reading the first paragraph. > Bank reserves are held as cash in the bank or as balances in the bank's account at the central bank The collapse of svb shows how much the central regulator cares about making sure the entire banking system doesn't fall apart, too. With the way you remarked "false" at the OP, though, I don't expect you're here for an engaging and educational discussion, so I'll leave it here. lol

jqpabc123 2y ago

It's possible to make stable-coins using just price oracle and collateral. Most attempts at "algorithmic" stable coins have failed. See TerraDollar, Luna and Titan.

killerstorm 2y ago
Over-collateralized stables are different from "algorithmic": the algorithmic ones are not fully backed by reserves.
- rafale 2y ago
  They are very capital inefficient and still can fail during black swan events.
- jqpabc123 2y ago
  the algorithmic ones are not fully backed by reserves. And you just know that the "collaterized" ones are? In most cases, their books aren't open. And they wouldn't lie about this would they? In some strange way, the crypto brain has been programmed to ignore the obvious with a hand wave and just accept all the chicanery that is crypto.
  - killerstorm 2y ago
    I gave you Liquity as an example. They don't have "books", it's a smart contract which takes ETH as a collateral and lets ppl to borrow LUSD against it. Maker initially worked same way, but eventually they started accepting off-chain collateral.

PhilipRoman 2y ago

Regarding fractional reserves... https://www.federalreserve.gov/newsevents/pressreleases/monetary20200315b.htm https://www.federalreserve.gov/newsevents/pressreleases/mone... >the Board has reduced reserve requirement ratios to zero percent effective on March 26, the beginning of the next reserve maintenance period. This action eliminates reserve requirements for thousands of depository institutions and will help to support lending to households and businesses.