bank runs are solely a feature of trust-based systems, rooted in holders’ distrust in a fin services co

if holders depend on verified data, trust is irrelevant, and bank runs don’t happen

tl;dr system can only be stable if overcollateralized AND liquid AND data-based… i.e. DeFi https://i.imgur.com/IqKix9G.jpg

all of the financial regulation is actually just a patch fix for issues of a trust-based system

centralized institutions = trust-based fin services = should comply w/ same regulation (bc it’s inherently needed)

decentralized institutions = data-based financial services = same reg not needed

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· Robmcmackin.com · Airfoil 

· Irish in Berlin

It’s different for coins-that-act-as-shadow-equity (which have equity dynamics - i.e. bad business can go bankrupt / coin can go to 0) vs. Defi financing or stablecoins (which have balance sheet driven dynamics - i.e. it’s about the underlying asset quality)

Curious; is it not fundamentally the same thing happening when a trustless coin goes to zero? (E.g luna, all the dead coins)