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Comment by synnejye | Hacker News Reader

This article makes no sense? There is a fundamental difference between issuing a random "IOU" (like anyone can do) and an "IOU" which is universally accepted as payment (ie money - which banks do).

I'm sure I could issue a OMGPWNIOU, but difference is, that no one will accept it as payment.

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It's not black and white like some IOUs are accepted everywhere and some IOUs are accepted nowhere. For example, USD is not accepted as payment in Finland, where I live. In the article I gave a concrete example of non-bank IOUs which were effectively money. If you have an argument why the Full Tilt Poker IOUs should not be considered money, let me hear it.

Full Tilt Poker didn't operate like a bank from what you described as they "had slowly siphoned off almost all player funds over the course of multiple years, leaving only a small fraction in reserve".

In this case they were like a _Ponzi Scheme_ and not like a fractional reserve bank as they had _no assets_ to redeem the claims of their depositors with.

Pokerstars (from what you've described) was operating in a manner similar to a fractional reserve bank.

Pokerstars was not operating like a fractional reserve bank, because it had segregated player funds to separate bank accounts. As in, it didn't have a "fraction" of reserves for the money players saw in their accounts, it had "full" reserves. It didn't have to go out and sell illiquid assets in order to pay players. It already had the money at hand.

If you want to characterize Full Tilt Poker's operation as a ponzi scheme, I have no problem with that. Full Tilt Poker was operating as a fractional reserve bank, and in addition to this it was siphoning assets of the bank to its owners.

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