Just been reading up on Fractional reserve banking and how banks effectively create new money into the currency system, very interesting. New money is effectively created, albeit theoretically balanced by physical assets such as property. The events leading up to the financial crisis of the last few years clearly showed that banks lent far to much money as loans that could not readily be repaid, that assets acting as colateral for these loans (e.g. property) were significantly overvalued.
In contrast to Fiat currency, BTC in circulation cannot be created faster than the natural mining process allows.
Whilst Bitcoin is perfectly designed to be used by anyone, anywhere, on any device, anywhere in the world, its very possible that, in time, some 'crypto banks' will exist that will hold Bitcoin for those people who want to negate the risk of losing their money from home PCs, laptops, e.g through loss/damage or hacking. (kind of the equivalent of choosing to put your dollars in a bank rather than risk keeping it under the mattress).
But could these new banks give out credit? If they could, I guess credit giving would need to be a lot more cautious and stringent, as new coin
cannot be physically created out of thin air, i.e crypto banks would indeed lend out a certain safe percentage of depositors reserves, but this would need to be on the proven medium/long term trend that there are 'Bitcoin users' who trust the crypto banks and leave certain amounts of their BTC with these banks without it being transferred or withdrawn for long periods.
would be interested in any thoughts or opinions on credit/loans with BTC?
There's an entire section of the forums devoted to providing credit.
