And that’s that. FDIC confirms it kills crypto in the acquisition https://www.fdic.gov/news/press-releases/2023/pr23021.html
Discussion
#news
I’ve honestly always been super dubious when people try to claim that we’re at the “then they fight you” stage with Bitcoin, but I really honestly struggle to find an explanation here that is anything *but* that.
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they have their own “crypto”, why would they bother? we’ll be what we came into this to be, what enchanted us since the very beginning: resistance.
Personally I see this as ignorance and strategic missteps, like China banning mining. Self inflicted wounds.
If I were fighting bitcoin in the US, I would mandate every bank offer a “bitcoin” account. Then, when most of bitcoin is inside, I would ban external transfers to unregistered wallets. Then I would require all bitcoin be transferred to a registered custodian on with major penalties for noncompliance. Then I would ban receipt of unregistered bitcoin. Then I would sell paper bitcoin to manipulate the price to take peoples bitcoin or ensure that they don’t care about it. Like they did with gold.
To destroy bitcoin, I would take away everything that make it good. I would use people’s preference for convenience to take away their freedom. Bitcoin would become the CBDC.
I’m *very* disappointed in the entire “bitcoin policy advocacy” world for not giving two shits about one of the biggest regulatory overreaches in bitcoin’s history.
Meanwhile the WSJ Editorial Board writes about it!
We’ve failed.
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They give two shits, probably more.
I’m personally happy the banks are farther away from bitcoin. In my mind there is a significant risk that they capture it the way they captured the gold market, and start selling paper bitcoin to manipulate the price they way they manipulated gold.
Fidelity’s recent announcement is a case in point. You can buy “bitcoin” through them, but can’t withdraw it. At some point that will be paper bitcoin.
From my perspective, the best thing for bitcoin is for it to grow up outside the current financial system.
You are one of the earliest, known Bitcoin contributors. What does “we’ve failed” mean? Isn’t Bitcoin the solution for banks failing?
We’ve failed to build influence and get policy people in place who will stand up for freedom. Sadly it seems very very few in the US care about freedom anymore, certainly neither major party does.
The biggest mistake they made, in my opinion, was joining forces with the shitcoin brigade, and defending the unregulated securities scams on libertarian, market-maximalist grounds. When instead they should have been making the case for bitcoin and stablecoins separately and forcefully. And probably throwing those other things under the bus, more deliberately.
I don’t buy for a second that would have changed the outcome here, even if I agree running a casino isn’t a business you should generally be excited about.
It’s hard to prove a counterfactual. But I think separating bitcoin out narratively, could have potentially helped the formation of more favorable legislative progress, in particular.
I dunno, the environmental argument was *the* trump card played until the ETH merge. Then the waters were muddied a lot.
Hell, if they were bitcoin +ETH or whatever they’d get more flak for environmental issues, even if the securities issues are reduced.
Even then, I would say that we hamstrung ourselves and made the environmental issues even easier to hit us over the head with, by taking the broad-based stance we did. I say this as someone who has been personally involved in a lot of this.
At least if they also support ETH the environmental argument is muddled, which I think has actually helped a lot over the past six months.
I think we can rebuild. But it’s going to be a tough slog. I am definitely deeply distressed by all this. But I am not dissuaded from the belief that we can recover.
Isn’t the FDIC just reimbursing the digital asset deposits?
Probably after liquidating everything in a fire sale?
Flagstar Bank's bid did not include approximately $4 billion of deposits related to the former Signature Bank's digital-assets banking business. The FDIC will provide these deposits directly to customers whose accounts are associated with the digital-asset banking businesses. Questions may be directed to (866) 744-5463.
The thing that dispirits me is those who laugh this situation off as irrelevant to bitcoin. The belief that fiat liquidity does not matter at all to bitcoin’s utility, when the dollar remains bitcoin’s unit of account, and the presence of deep liquidity markets actually lowers the risk of holding bitcoin, which in turn, makes utility uptake in bitcoin payments easier — is an endlessly frustrating attitude I see within the bitcoin world. People laugh this situation off at their own peril.
a hit on bank's dealing with bitcoin friendlies
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Is this legal? Any chance that the depositors could form a class and file a lawsuit? More likely to win together, I'd guess.
Just thought to check what Block Association is up to and it seems they started requesting info from affected parties and the involved government agencies. Here's one tweet from a Jake Chervinsky thread that answers my question: