U.S. FDIC tells Signature crypto clients to close accounts by April 5

Re:U.S. FDIC tells Signature crypto clients to close account... by lxgr on Wednesday March 29, 2023 @12:09AM (#35352395)

The only one of these that makes sense is a Fed balance (as it is not only free but even pays interest), but the Fed does not seem to be a fan of the idea [1].

Cash in vaults has negative yield (the vault itself isn't free, nor is insurance for it), and if you don't like fractional reserve banking and/or counterparty risk, foreign correspondent banks don't really seem like a good way to eliminate it either.

[1] https://www.bloomberg.com/opinion/articles/2019-03-08/the-fe...

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Re:U.S. FDIC tells Signature crypto clients to close account... by mike_d on Wednesday March 29, 2023 @03:52PM (#35362429)

I'm not sure what you are criticizing specifically, I just answered the question of how banks hold cash.

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Re:U.S. FDIC tells Signature crypto clients to close account... by lxgr on Wednesday March 29, 2023 @07:59PM (#35365755)

Ah, yes, for regular banks that makes total sense – I was just outlining why neither of these options would be realistic for a full-reserve bank as mentioned by GPs.

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