Dan Romero
@dwr.eth
Type of financial entity that should exist: - Consumers and businesses can easily sign up - Federally regulated - Only function is to custody USD - No fractional reserve - Ability to opt-in to yield via US Treasuries - Revenue model: cut of Treasury yield or $9.99/m subscription
14 replies
0 recast
0 reaction
Fred Blauer
@fblauer
The insurance Co's could just offer insurance for deposits that are not covered by FDIC. But I suspect that people wouldn't buy it since it lowers the rate that they are earning on deposits. You don't need to create new entities that are not profitable. I don't think there is incentive to do that.
1 reply
0 recast
0 reaction
Dan Romero
@dwr.eth
You don’t need insurance if you change the model.
2 replies
0 recast
0 reaction
Fred Blauer
@fblauer
If you spread your investment in 250k chunks over several banks than all your deposits will be covered by FDIC insurance. Easier than changing laws and regulations.
1 reply
0 recast
0 reaction
Dan Romero
@dwr.eth
That’s a hassle and not desirable from a consumer perceptive. Consumers want a digital safety deposit box for dollars.
1 reply
0 recast
0 reaction
Fred Blauer
@fblauer
So you are saying that consumers don't want to earn a return on their deposits. With inflation, their deposits would keep shrinking. So in effect that would get negative interest. Also where would the funds come from for small business loans?
1 reply
0 recast
0 reaction
Dan Romero
@dwr.eth
1. Consumers could opt in to yield on Treasuries. 2. Not the consumers problem
1 reply
0 recast
0 reaction
Fred Blauer
@fblauer
Treasuries are only 1 kind of investment. Do they have to ask the consumer each time they want to sell one and buy another investment? Not very practical. Business loans are another one of those kinds investments. If there is demand for what you describe why is no one offering it?
1 reply
0 recast
0 reaction