Will A Fractional Reserve System Exist On A Bitcoin Standard?
The free banking era is the closest example of how banking might look on a bitcoin standard, but will credit and fractional reserves be part of that system?This is a transcribed excerpt of the “Bitcoin Magazine Podcast,” hosted by P and Q. In this episode, they are joined by Eric Yakes to talk about the 7th property of money that Bitcoin introduced, fractional reserves on a bitcoin standard and what interesting Bitcoin projects are happening in the space right now.Watch This Episode On YouTube Or RumbleListen To The Episode Here:AppleSpotifyGoogleLibsynEric Yakes: I've been....
Related News
Most people in the Bitcoin community agree that the digital currency has the ability to render fractional reserve banking impossible, but not everyone agrees on whether or not this development would be a good thing. The skeptics worry that without fractional reserve banking, it will somehow be impossible for banks to make loans. Taking this ability from....
Bear markets are much more brutal for crypto lenders than cryptocurrency firms that don’t leverage users’ deposits, according to one Bitcoin analyst. The ongoing bear market on cryptocurrency markets is too harmful to industry lenders, but the concept of crypto lending can still survive the bloodbath, according to some industry experts.Cryptocurrency lending is a type of crypto service that allows borrowers to use their crypto assets as collateral to get loans in fiat currencies like the United States dollar or stablecoins like Tether (USDT). The practice allows users to get money without....
How would a bitcoin standard fare for a monetary system? An analysis by the Bank of Canada examined that scenario, conjecturing how a bitcoin standard would perform based on the performance of a gold standard that existed from 1880 to 1913. The gold standard was a monetary system in which nations’ currencies were tied to gold. The 37-page paper [PDF] is written by Warren E. Weber, research consultant at the Bank of Canada, visiting scholar for the Federal Reserve Bank of Atlanta, and adjunct professor at the University of South Carolina. The paper claims that because....
The fear of MtGox's potential insolvency has shaken the entire bitcoin ecosystem. Many in the Bitcoin community are beginning to demand "proof-of-reserve" from their exchanges and financial services in the aftermath of MtGox ceasing withdrawals and committing some of the worst public relations the community has ever seen (and that says a lot considering Bitcoin's history in the dark-net). In fact, Bitcoinity is offering free advertising space to the first exchange that implements a way to prove that customer funds are secure, without divulging sensitive information. There are some ideas of....
David Andolfatto, vice president of the Federal Reserve Bank of St. Louis, came out Monday with some words that should be encouraging to the Bitcoin world. He said that the open-source, transparent, decentralized management of the blockchain, the ledger that underpins all Bitcoin transactions, is a "stroke of genius." He believes the Federal Reserve could do a lot better job in being accountable to the public. Also read: Bitcoin Price and the Federal Reserve. He derided the notion that Bitcoin or other digital currencies are the future, however, and unequivocally stated that nearly all....