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RE: What is Fractional Reserve Banking, and is it Fraud?

in #bitcoin7 years ago

Fractional-reserve banking operates much differently now a days. For a start, modern banks are much more restricted via capital requirements rather than liquidity requirements. As long as a bank is solvent, it can issue as many deposits as it likes.

It's not in any way a fraudalent practice - all it is an instuition holding long-term debts and financing them with short-term debts (i.e. bank deposits).

My post might help clear things up - https://steemit.com/bitcoin/@mooncryption/what-is-fractional-reserve-banking-and-is-it-fraud