Hacker News Reader

Comment by karpierz | Hacker News Reader

> Kraken knows this.

Clearly, because they won't attest to liabilities (IE, how much money do they owe in total), but "client liabilities" (IE, how much money do they owe to their customers).

If they took out a loan for 100M, with their client's assets as collateral, that won't be covered by "client liabilities", but it sure as hell will be a problem when that loan gets called in.

View on HN

Looks to me that is not so different from 'normal' banks

Except "normal" banks are regulated with a history of regulation going back for more than a century.

Regulate crypto exchanges then. They're just banks in disguise.

Why do you want crypto regulated? I thought the goal of crypto is to free you from regulation and government control.

If crypto is regulated, your crypto can be seized, frozen, held, and so on.. Why regulate it?

The state already has the power to seize, freeze, or hold crypto. That has nothing to do with regulation.

Yeah, but the Wild West nature of crypto is its selling point, maybe even its raison d'etre. What would be the point in regulated crypto? It won't do anything that the traditional banking system doesn't already do.

Well your basic assumption was already wrong, what else do you want me to tell you? That people don't personally care whether or not cyrpto's selling point remains viable? as if anyone should

I want cryptocurrency exchanges regulated. Not cryptocurrencies themselves. They are distinct. Cryptocurrencies are perfectly good technology, exchanges are fractional reserve banks in disguise.

And as we know this system has been working perfectly.

Certainly not perfectly, but compared to the chaos that is the world of crypto, positively mundane and peaceful.

No deposits were lost, the FDIC even extended the insurance to be above the pre agreed limit.

Normal banks undergo regular audits, and get seized by the government when there's a wiff of insolvency about them.

Reply on news.ycombinator.com