a) yeah, but if coinbase and bitcoin are successful, that won't be true for long. I'm sure those guys are hoping Wall Street money will start coming in. If the

a) yeah, but if coinbase and bitcoin are successful, that won't be true for long. I'm sure those guys are hoping Wall Street money will start coming in. If the bitcoin price spikes again, they may then have to stop being insured, which is worse than just not having it. Still, fair point. b) Why unreasonable? Because only a really foolish person would keep a humongous amount of value stored on an exchange. There just isn't any reason to use an exchange like a bank exept laziness. The only exception here would be market makers and maybe big-time day traders who actually have a reason to keep a ton of money on the exchange at all times. Of course, those are the most valued partners/customers for an exchange. I would think it would make sense for Coinbase to make deals with such people to give them "priority" in case of any solvency problems, or to ensure them somehow on an individual basis, but I don't know for certain that that is legally viable. So in my point (b), in some ways, I'm vindicating what you are saying. But still, for the vast majority of people in bitcoin-land, there is no reason to have more value stored in Coinbase than what you need to do whatever you are doing. For example, for me personally, if I transfer $10k to Coinbase, I'm not paranoid enough to be worried about their offline coins being insured. And I wouldn't transfer a large enough amount of money to really impact me financially regardless. At least, not all at once; if I really wanted to do that, I would do it in stages.