Re: crypto investing, social, politics

I am concerned. A lot of money is going into Bitcoin.

According to market cap other cryptos are receiving 44% of the fiat money input. (Though note that market cap is a bogus metric.)

as long as the investors are solvent. But the current crop aren't. A lot of that money is borrowed.

If users don't evaluate and/or overextend themselves that's their own fault. Help them evaluate.

And now banks are borrowing to hold bitcoin in their portfolios....

If able to borrow from govt / users, that's tricky. If they borrow at 0%, no problem, sell the crypto and repay. If they borrow at > 0% to enrich themselves, you shouldn't be entrusting your fiat to such entities who thereby devalue and possibly lose and take it. Not that it matters anyways since every fiat spent into crypto devalues that fiat ala minimally forex shift. A couple Golden Rules of fixed quantity cryptos: - Never sell for any amount less than your buy price minus any amount granted as disposable risk. - Hodl, at least until you don't have to anymore, or adoption happens. Would you accept less than a dollar for your dollar? No! Yet you accept it every day due to money printing inflation. If you hodl fiat, you will lose value... there is no point at which you can execute a stop loss on fiat, except by move to non inflating asset, or grow it and try to beat whatever prime and other rates, taxes, etc. Many cryptos are non inflating (aka: not lossy), and are currently also high growth. What's interesting is that borrowing markets are already developing among cryptos themselves, even extending out to fiat.

A lot of the institutions holding that bitcoin for their customers don't have anything like the amount of USD on hand that they'd need to cash

In order to lay hands on that amount of USD, of course they'd have to sell Bitcoin.

Show us a contract from any such institution stating that such institution itself will guarantee and pay fiat on demand. Exchanges don't do that, they're neutral, their order books do. Wallet providers (aka: banks) don't do that, their insurers do. Insurers don't do that, because they're woefully insolvent aganst systemic / mass / excess casualty. Including these... http://c7.alamy.com/comp/C4B932/money-changers-carry-loads-of-low-value-note... https://rarehistoricalphotos.com/hyperinflation-weimar-republic-1922/ Users hold their private keys against counterparty default.

the customers out in case something happened that shook their confidence

Most crypto is ownership, not debt. Provided the crypto, protocols, and network ops are strong... there is no internal confidence event. Regulation will cause most external confidence events. Until the swiss bank in your phone absorbs, overpowers, and governs regulators and other influences causing them.

A large sell-off in a thinly traded asset would cause a market shock.

What do you think last months massive buy in was? Exchanges and connections tanked because they were chumps and/or jammed by regulatory limits.

The customers would get less money than expected for their coin due to the market shock.

No, they get exactly what's under their mouse button when they decide to click it.

they were "cheated", might prompt more customers to want to sell.

They were cheated at fiat debt, not crypto owned... a prudent investors has no current reason to sell crypto. The promise of crypto and the unwritten compact of its users is that there is no reason to sell, only to adopt and use it... https://i.pinimg.com/564x/38/ab/52/38ab529815f55064db140e235a8d8820--blue-pi... The ever growing many thousands of places around the world accepting crypto prove this theory is working and will continue to do so.

intended to be something where debt wasn't possible.

Again, hidden debt, in an open ledger crypto, isn't possible. You either own it or you don't. None of this precludes the issuance of crypto loans.

But when people are in debt to own something and... [spiral]

Who voted for and invested in a resultant scheme that let that happen? Trying to write around the failures of all of govts, fiat, and the users like this... is a failure in itself. Don't do that.

It's starting to sound a lot like those funny mortgages people were writing in 2007.

Yes, the fiat schemes are sounding like that, the crypto badger itself is just fine as always and simply doesn't give a shit. Own some, without taking on debt to do it.