Will "Cold Storage for SAFE" be the execuse of "fractional reserve" system?

[finway]

And when will mtgox implement MultiSig and dismiss "Cold Storage" ?

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[lonelyminer (Peter Šurda)]

An interesting question. Nevertheless, unless MtGox codes become generally accepted as a payment method, there's no need to worry about FRB.

[Explodicle]

I don't imagine MtGox has much incentive for FRB. They make a lot of money as an exchange, so investment probably isn't worth risking their leading position. Unless MtGox codes start getting used heavily like lonelyminer said, Bitcoin and Bitcoin stocks are just too volitile.

[finway]

I guess GRAVITY made GOLD STANDARD   FRB,  I wonder what can make BITCOIN FRB.

[molecular]

An interesting question. Nevertheless, unless MtGox codes become generally accepted as a payment method, there's no need to worry about FRB.

FRB is possible for Gox even without gox-codes being used as currency. They could simply use the bitcoins in deposits, so the sum of users bitcoin balances would be lower then the sum of bitcoins held by gox. That would be a kind of fractional reserve banking, right? The money would not be in circulation, but it would exist as depostis in mtgox accounts with no bitcoin backing.

I doubt they would, because, quite frankly, there is no good and safe way to invest these bitcoins otherwise.