Question though nostr:npub1cj94enk44kn5mvrcma4sp7jnlsgnn4em7rk3dh3jt4fzyqs3m02s560efa !

How exactly does it work?

1) $100 dollars deposited at institution A, A keeps $10 (with a 10% reserve ratio), and lends out $90, the $90 gets deposited at B, who keeps $9 and lends out $81, and so on and so forth until the $900 is created, or

2) can A hold the $100 and create $900 worth of loans straight away?

And if it’s 2) wouldn’t institution B then be able to create $9,000 of loans straight away from the $900!?!?