> banks lose a lot of money to fraud and nobody is prosecuted.

That's true some times, but then it works like an insurance policy to me. I like insurance, especially when it's about my life savings.

> a future financial institution will be a third party service providing custody or other protections to your crypto bearer instruments.

As you mentioned, that's a bank. There's no reason to believe that crypto-based banks will be any better than traditional ones, especially if you compare to newer fintechs.

> many people get paid back after being scammed, rug pulled, exploited

I was not aware of that, thank you. But it's still too few compare to the whole.