Every so often, I get a weird gut instinct, a sort of white noise of nausea that says something bad is going to happen, long before my logical brain actually realizes what I’m worried about or what’s going to happen. It’s happened in late 2019, and a few months ago, and I am currently feeling it right now as I read the surprisingly negative press around Bitcoin’s return to $23,500.
Ed, one other thought on bankruptcy. I can only speak for the UK but an insolvency practitioner will take their costs out of the safeguarded funds. This is likely to be 10-15%. So, there is zero chance of getting back a $ for a $ on liquidation of these assets. Assuming the same IP cost recovery model holds true in the US. It is the biggest dirty secret of e-money firms (crypto and fiat) who brag about safeguarded funds with bankruptcy protection. There is a cost to liquidation and distribution to customers, and it’s the customers who bear those costs. This is not remotely like a deposit guarantee.
Ed, one other thought on bankruptcy. I can only speak for the UK but an insolvency practitioner will take their costs out of the safeguarded funds. This is likely to be 10-15%. So, there is zero chance of getting back a $ for a $ on liquidation of these assets. Assuming the same IP cost recovery model holds true in the US. It is the biggest dirty secret of e-money firms (crypto and fiat) who brag about safeguarded funds with bankruptcy protection. There is a cost to liquidation and distribution to customers, and it’s the customers who bear those costs. This is not remotely like a deposit guarantee.
Show me the money!
Crypto is like a very slow flushing toilet. But it does flush. Completely. And, eventually, it becomes empty.