7 ms·

That's a very weak argument. We just had the biggest financial crisis since the 1930s and not a single saver in the U.S lost their funds in a regular bank accou

That's a very weak argument. We just had the biggest financial crisis since the 1930s and not a single saver in the U.S lost their funds in a regular bank account. Here's the secret: Deposit insurance. Bitcoin related organizations are well advised to start copying some of the good parts of the traditional financial system instead of just pointing at its weaknesses. Some have already started: http://www.bbc.com/news/technology-25680016 http://www.bbc.com/news/technology-25680016

maxerickson 13y ago
That's not strictly true, people lose money above the insurance limit all the time. The reports here frequently discuss it: http://www.fdic.gov/bank/individual/failed/banklist.html http://www.fdic.gov/bank/individual/failed/banklist.html If you go here, you see depositors not being made whole: http://www2.fdic.gov/divweb/index.asp#bottom http://www2.fdic.gov/divweb/index.asp#bottom But $250,000 of insurance for each account is much better than none.
- pjc50 13y ago
  Neither of those two citations actually list or enumerate people losing any value of their deposits. They just describe the process by which it would happen. (That's a lot of banks! The US system seems quite fragmented?)
  - maxerickson 13y ago
    If you select "All Banks" in the drop down at the bottom and run a report, you see a bunch of "Final" dividends where the percent paid is less than 100%. I'm pretty sure that's people losing value of their deposits. (remember, those are 'dividends to claimants' and the claimant listed is almost always 'depositors')
    - ars 13y ago
      If you have more than $250,000 and didn't use one of these services[1] then you were really negligent with your money. [1]http://www.bankrate.com/finance/savings/6-ways-to-insure-excess-deposits.aspx http://www.bankrate.com/finance/savings/6-ways-to-insure-exc... Basically there are banks that will divide your money amongst a bunch of independent banks, and let you access the money as if it were all in one bank.
ericb 13y ago
Well, that's only nominally true. Every single holder of USD lost around 1-2% a year to inflation, which is essentially a backdoor tax. If you were in Cypress, or had a less trustworth (irony?) government that went out of business, you probably didn't do well either.
- merloen 13y ago
  > Every single holder of USD lost around 1-2% a year to inflation, which is essentially a backdoor tax. That's only true of cash, and money in checkings accounts. Money deposited in savings accounts yields interest, which (on average) more than compensates for inflation.
  - mcdougle 13y ago
    What banks have savings accounts that yield that much interest? The average yield on a savings account that I've seen is 0.01%. I've seen some "high yield" accounts that can get you 0.03%. If you're talking about money market accounts (where I believe you need to park a substantial amount and can't touch the money in the account for something like 10 years, but correct me if I'm wrong), you can get up to 3% yield (just beating the stated inflation of 2%). Am I missing something?
    - tveita 13y ago
      http://www.money-rates.com/research-center/best-savings-accounts/2014.htm http://www.money-rates.com/research-center/best-savings-acco... Interest rates are very low right now, but you appear to be off by a order of magnitude.
      - mcdougle 13y ago
        You're right. I was just pulling numbers from memory. Still, even those examples are an order of magnitude off from keeping up with 1% to 2% inflation.
    - merloen 13y ago
ry0ohki 13y ago
So you're proposing to add more of the things that make our current financial system have the costs it does? Given the large amounts that have been stolen recently, I think deposit insurance would cost a fortune for BTC.
- fauigerzigerk 13y ago
  Bitcoin deposit insurance could be much cheaper than deposit insurance for traditional banks as they are not lenders and hence there is no credit default risk. All they have to do is up their QA game and organize some external audit and certification system for all participants in the insurance scheme.
kennethh 13y ago
No one loosed UDS in the crisis but the value of the USD is decreasing every year. Since the 2008 crisis the amound of usd M2 has increased by roughly 50%. http://research.stlouisfed.org/fred2/series/M2 http://research.stlouisfed.org/fred2/series/M2 That means Your Money have lost 30% of its value in 5 years. The official inflation numbers excludes some items and incorperate others and was different 20 years ago then now.
- fauigerzigerk 13y ago
  >That means Your Money have lost 30% of its value That's completely false. You are ignoring the velocity the of money: http://en.wikipedia.org/wiki/Velocity_of_money http://en.wikipedia.org/wiki/Velocity_of_money And contrary to a savings account your bitcoin wallet doesn't even pay interest.
- hnnewguy 13y ago
  >the official inflation numbers excludes some items and incorperate others and was different 20 years ago then now. Yes. It no longer includes weaving looms, and now includes consumer electronics. You have an issue with that? We don't spend our money on the same basket of goods as we did 50, 25, or even 10 years ago. The CPI should be and is fluid. You should look into how it's actually calculated, rather than going by your favourite conspiracy site's reports.

maxerickson 13y ago

That's not strictly true, people lose money above the insurance limit all the time. The reports here frequently discuss it: http://www.fdic.gov/bank/individual/failed/banklist.html http://www.fdic.gov/bank/individual/failed/banklist.html If you go here, you see depositors not being made whole: http://www2.fdic.gov/divweb/index.asp#bottom http://www2.fdic.gov/divweb/index.asp#bottom But $250,000 of insurance for each account is much better than none.

pjc50 13y ago
Neither of those two citations actually list or enumerate people losing any value of their deposits. They just describe the process by which it would happen. (That's a lot of banks! The US system seems quite fragmented?)
- maxerickson 13y ago
  If you select "All Banks" in the drop down at the bottom and run a report, you see a bunch of "Final" dividends where the percent paid is less than 100%. I'm pretty sure that's people losing value of their deposits. (remember, those are 'dividends to claimants' and the claimant listed is almost always 'depositors')
  - ars 13y ago
    If you have more than $250,000 and didn't use one of these services[1] then you were really negligent with your money. [1]http://www.bankrate.com/finance/savings/6-ways-to-insure-excess-deposits.aspx http://www.bankrate.com/finance/savings/6-ways-to-insure-exc... Basically there are banks that will divide your money amongst a bunch of independent banks, and let you access the money as if it were all in one bank.

ericb 13y ago

Well, that's only nominally true. Every single holder of USD lost around 1-2% a year to inflation, which is essentially a backdoor tax. If you were in Cypress, or had a less trustworth (irony?) government that went out of business, you probably didn't do well either.

merloen 13y ago
> Every single holder of USD lost around 1-2% a year to inflation, which is essentially a backdoor tax. That's only true of cash, and money in checkings accounts. Money deposited in savings accounts yields interest, which (on average) more than compensates for inflation.
- mcdougle 13y ago
  What banks have savings accounts that yield that much interest? The average yield on a savings account that I've seen is 0.01%. I've seen some "high yield" accounts that can get you 0.03%. If you're talking about money market accounts (where I believe you need to park a substantial amount and can't touch the money in the account for something like 10 years, but correct me if I'm wrong), you can get up to 3% yield (just beating the stated inflation of 2%). Am I missing something?
  - tveita 13y ago
    http://www.money-rates.com/research-center/best-savings-accounts/2014.htm http://www.money-rates.com/research-center/best-savings-acco... Interest rates are very low right now, but you appear to be off by a order of magnitude.
    - mcdougle 13y ago
      You're right. I was just pulling numbers from memory. Still, even those examples are an order of magnitude off from keeping up with 1% to 2% inflation.
  - merloen 13y ago

ry0ohki 13y ago

So you're proposing to add more of the things that make our current financial system have the costs it does? Given the large amounts that have been stolen recently, I think deposit insurance would cost a fortune for BTC.

fauigerzigerk 13y ago
Bitcoin deposit insurance could be much cheaper than deposit insurance for traditional banks as they are not lenders and hence there is no credit default risk. All they have to do is up their QA game and organize some external audit and certification system for all participants in the insurance scheme.

kennethh 13y ago

No one loosed UDS in the crisis but the value of the USD is decreasing every year. Since the 2008 crisis the amound of usd M2 has increased by roughly 50%. http://research.stlouisfed.org/fred2/series/M2 http://research.stlouisfed.org/fred2/series/M2 That means Your Money have lost 30% of its value in 5 years. The official inflation numbers excludes some items and incorperate others and was different 20 years ago then now.

fauigerzigerk 13y ago
>That means Your Money have lost 30% of its value That's completely false. You are ignoring the velocity the of money: http://en.wikipedia.org/wiki/Velocity_of_money http://en.wikipedia.org/wiki/Velocity_of_money And contrary to a savings account your bitcoin wallet doesn't even pay interest.
hnnewguy 13y ago
>the official inflation numbers excludes some items and incorperate others and was different 20 years ago then now. Yes. It no longer includes weaving looms, and now includes consumer electronics. You have an issue with that? We don't spend our money on the same basket of goods as we did 50, 25, or even 10 years ago. The CPI should be and is fluid. You should look into how it's actually calculated, rather than going by your favourite conspiracy site's reports.