Sentences with phrase «fractional reserve means»

(As an aside, equilibrium means «no tendency to change,» fiat means deriving its value from law rather than some underlying commodity backing, and fractional reserve means that banks hold only a fraction of deposits on reserve, loaning the rest out.).

Not exact matches

Here is John Carney arguing that «There's nothing about Bitcoin that means you can't have fractional reserve banking,» which is entirely correct but bear in mind that he's arguing against libertarian bitcoin supporters who view the absence of fractional reserve banking as a desirable feature of bitcoin.

I mean given that the fractional reserve banking system is so over-levered, globally, but just thinking about the U.S. for a minute if everybody put 5 % -10 % of their money in Bitcoin or some other cryptocurrencies, the whole banking system implodes on itself.

For those unfamiliar with fractional reserve banking it just means that the bank isn't required to keep 100 % of the amount on deposit in the bank at all times.

Any person who creates or originates United States money by lending against deposits, through so - called fractional reserve banking, or by any other means, after the effective date shall be fined under title 18, United States Code, imprisoned for not more than 5 years, or both.

I mean a normal person isn't allowed to lend what he does not owe, but a bank can do that under the fractional reserve rule.

We live in a fractional reserve world, which means if mass hysteria takes hold and everyone tries to redeem their investments simultaneously, the cash runs out pretty quickly.

Some critics argue that Ripple only copies those aspects of the current fiat currency and fractional reserve - based financial system that cryptocurrency is meant to solve.