Your bank does not hold your money.

When you deposit $1,000, the bank lends out $900 of it immediately. Your account balance is an IOU — a promise to pay you back on demand. This works fine when only a few people withdraw at once. It fails catastrophically when many people try to withdraw simultaneously. That is called a bank run.

The FDIC insures deposits up to $250,000. But the FDIC insurance fund holds roughly 1.2% of total insured deposits. If more than 1.2% of deposits are withdrawn at once, the fund is depleted.

This is not a hypothetical. In March 2023, Silicon Valley Bank collapsed in 48 hours when depositors tried to withdraw $42 billion in a single day. The bank was solvent on paper but could not meet withdrawal requests because the money was not there.

Bitcoin fixes this because there is nothing to withdraw from. You hold the asset directly. There is no intermediary, no fractional reserve, no IOU. Your keys, your coins. That is not a slogan. It is a structural difference.

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