But in all seriousness I bet Tether and Bitfinex are both more liquid then everyone's local bank is. For whatever reason, fractional reserve in fiat people turn a blind eye while fractional reserve in crypto people freak the fuck out. My point is I bet Tether is closer to having the 2.3 billion then they are at having 0, which is more then most banks can say about the funds they claim to have. It will be interesting to see how this Tether/Bitfinex situation turns out over the coming days/weeks, as honestly it could go either way.
Right? When this was happening I was thinking "banks do this all the time.." Banks can literally create money legally, so why do we pay them interest? And I used to wonder why they always had the biggest nicest buildings and employed so many people
Go to any decent sized city in the US or Canada and almost 100% of the time the 5 tallest buildings are all banks. Guess what folks, you pays for those things, and guess what the bank only holds a fraction of the money needed to back those deposits (~10%), and guess what the FDIC only has enough money to fund ~3% of the deposits if the bank were ever to go bust. But hey, lets all ignore that... and instead freak the fuck out about Bitfinex cuz why not right?
Haha exactly, like if it comes back and they have 0 dollars, somehow magically stole it all I'll get it, but I bet they are at least decently backed where-as banks just present the illusion that they have the money. Probably because they do have the money, your money that they took through interest rates for money they created out of thin air.
Ta Da!
Really