The bit about not being able to cash out over $1k is flat out false.
The order book history from GDAX (I maintain a personal level 3 copy) also doesn't suggest market pressure at $12k beyond a lot of opportunists (myself included).
The order book history from GDAX (I maintain a personal level 3 copy) also doesn't suggest market pressure at $12k beyond a lot of opportunists (myself included).
The exchanges will happily let you deposit, buy, and sell, but when you want that wire transfer there are magically a bunch of hurdles to jump. BTC market cap is currently $233,616,547,500. The total USD held by reputable exchanges is probably in the low hundreds of millions.
Could I have done the same with $1M USD? I have no idea.
The bar is considerably higher than $1k, though, and I'd wager is considerably higher than most people have to comfortably move around.
For sure, if everyone did a bank run then there would be a liquidity shortage. But saying that is wayyy different than what the article said, that most people couldn't even withdraw $1k.
It's obvious that this would be the case in a fractional banking system, but assuming that Gemini or Coinbase aren't complete crooks, through which mechanism would they not have enough cash on hand?
For each transaction on their exchange, they'd receive money from the buyer and pass that on to the seller?
I, personally, prefer to keep my dollars in dollars and in an FDIC insured account.
That said, you’re being upvoted because what you’re saying makes instinctual sense.