[afiori]

> Lots of banks use Oracle to record fund transfers, but Oracle doesn’t transfer any funds.

because it is the banks that do the transfer, so they need to have liquidity

> Bitcoin doesn’t transfer funds, it’s just a shared ledger of what funds have been transferred.

the bitcoin blockchain act as a single bank in terms of transfering between bitcoin wallets, there is no need for central liquidity because it is all "internal".

A perfect example is arbitrage between bitcoin exchanges, to my undestanding many exchanges do internal transactions off-chain and only interact with the public blockchains for deposits/withdrawals. If a user wanted to exchange bitcoin for ether and then withdraw the sum the exchange would need to have liquidity in ether for the withdrawal.