Hacker News new | ask | show | jobs
by kevingadd 2950 days ago
Fractional reserve is also regulated and deposits are insured up to a certain amount, so it's definitely not comparable to printing imaginary USDT - even if fractional reserve banking has many well-known issues.
1 comments

That regulation didn't work so well 10 years ago. Regulation is for us, not the big dogs.
It worked fine. I don’t know what you’re talking about.
Americans got screwed and no banking executives went to jail. It didn't work.

It's one of the reasons Bitcoin was created, per the first transaction in the blockchain.

Fractional reserve banking is not what failed in the financial crisis. Multiple things failed, including credit ratings, mutual funds/pensions/etc investing in high risk investments, etc. The biggest risk people think of for fractional reserve - they won't have the money when you need it, a run on banks, etc - didn't really happen in the states in any significant fashion.
No one really went to jail because they didn't break any laws. They fucked up, but not in an illegal manner.