i don’t think Hal thought this through at the time. free banking can work, just not fractionally reserved free banking… Selgin et al. don’t understand the inevitability and speed at which bank runs would occur when attempted with bitcoin.
Discussion
FTX was effectively a fractionally reserved bitcoin bank. The run took no more than 24 hours iirc.
No it wasnt, bad example.
The reserve of a bank could be something other than bitcoin, or future payments of bitcoin from their outstanding loans.
Thats why I think he left it open like that.