A strategy advisor at Vaneck/MVIS is highlighting the disparity between the money held at the Federal Deposit Insurance Corporation (FDIC) and the amount of money sitting in the US banking system.
In a series of viral tweets, Gabor Gurbacs examines the latest data from the FDIC – a US agency whose mission is to maintain stability and public confidence in the nation’s financial system.
According to the FDIC, $124.5 billion is моментално on the agency’s balance sheet, with an дополнителни $100 billion line of credit available from the U.S. Treasury, for a total of $224.5 billion.
That compares to a staggering total of more than $22 trillion in the US banking system, says Gurbacs.
The renewed scrutiny of the FDIC’s balance sheet comes amid the collapse of Silicon Valley Bank, which shut its doors after losing $1.8 billion from selling mainly US bonds that are supposed to offer banks a safe way to diversify.
However, the price of those bonds has dropped significantly due to the Federal Reserve’s steep interest rate hikes.
Many in the startup community, which Silicon Valley Bank largely catered to, are calling for the U.S. Treasury to step in and bail out the bank, as happened during the 2008 financial crisis.
American banks align with the FDIC to promise customers that deposits up to the amount of $250,000 will always be covered in the event of a collapse.
But anything in excess is not insured.
Of course, the FDIC doesn’t cover anything above $250k… so basically no businesses. It’s practically worthless. People trust banks more than what they should. Tier 1 leverage ratios (tier 1 capital/consolidated assets) show just how much more leveraged banks are vs stablecoins. pic.twitter.com/310MoMEoXI
- Габор Гурбац (@gaborgurbacs) Март 10, 2023
The US and most nations around the world back a system known as fractional reserve banking, which requires banks to hold a small percentage of their deposit liabilities in liquid assets as a reserve, while being at liberty to lend the remainder to borrowers.
It’s a system that the pseudonymous creator of Bitcoin, Satoshi Nakamoto, извика as a core reason why he, she or they created the leading cryptocurrency.
„Основниот проблем со конвенционалната валута е сета доверба што е потребна за да функционира. Мора да и се верува на централната банка да не ја понижи валутата, но историјата на фиат валутите е полна со прекршување на таа доверба. На банките мора да им се верува да ги чуваат нашите пари и да ги префрлаат по електронски пат, но тие ги позајмуваат во бранови кредитни меури со едвај мал дел во резерва. Мораме да им веруваме во нашата приватност, да им веруваме да не дозволат крадците на идентитет да ни ги исцедат сметките. Нивните огромни режиски трошоци ги оневозможуваат микроплаќањата…
Со е-валута заснована на криптографски доказ, без потреба да се верува на трет посредник, парите можат да бидат безбедни, а трансакциите без напор“.
In contrast to the modern banking system, Bitcoin is backed by its core technology for validating and securing transactions without a middleman, its strict level of scarcity with a total of 21 million coins, and its decentralized web of users who power the network and hold their capital in BTC.
Billionaire Elon Musk posted a tweet in light of Silicon Valley Bank’s collapse, which follows a precipitous drop in the price of Bitcoin after the fall of the crypto-friendly bank Silvergate.
- Елон Муск (@elonmusk) Март 11, 2023
Сребреница гафови “recent industry developments” as well as “investigations from our banking regulators, congressional inquiries and investigations from the U.S. Department of Justice” as the main reasons the bank decided to close its doors.
Bitcoin has been in the midst of a volatile recovery after dropping to about $16,000 late last year due to the collapse of the offshore crypto exchange FTX.
FTX is accused of essentially stealing and gambling its users funds, and its founder Sam Bankman-Fried is now facing 115 years in prison for a long list of charges including wire fraud and securities fraud.
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Source: https://dailyhodl.com/2023/03/11/22-trillion-in-us-banking-system-backed-by-just-225-billion-at-fdic-bitcoin-proponent-gabor-gurbacs/