Sounds like one is exhibiting features of a currency and the other isn't.
I don't think you're supposed to store your wealth in cash if you want to preserve it (diversified equity holding are a popular investment too in case you find cryptocurrencies too volatile).
The money in a bank is not paper currency. Your deposit is backed by as little as 3% cash reserves. My original point was that crypto is a medium of exchange, like cash, not that it is a store of value, like bank account deposits.
What's the difference between buying gpus and storage to control the crypto and locking money in that crypto? I personally fail to see it since both lock your money and generate interest. Its just a different way to lock it. Plus PoS scheme have better control over that locked money, and can more easily punish bad actors.
Almost the entire comments mix "crypto" with Bitcoin or "all cryptos are the same" which is factually false. Please explain how different it is in comparison, the thread is flooded with baseless claims. This is analogous to placing your money under the bed vs. in a bank vault, they're both unsafe technically, but the difference is vast.
A major difference is the clearing model. The asset classes you mention generally have a clearing house behind them. This is designed to protect the system against counterparty risk. If one party goes under, it has limited contagion, even to the people who were (in practical terms) on the other side of the trades.
This layer of protection allows better specialisation. In crypto, you need to trade on your own balance sheet. In centrally cleared markets, it is routine for trading firms to lease balance sheet from banks, who have lots of capital and good risk management at scale, but who are typically less effective at trading specific markets competitively. This leads to more liquidity being available and more competitive markets.
What difference you mean, aside from the lack of a regulatory framework, pseudonymity (and paradoxically, lack of privacy), lack of recourse in the face of user error, and custodial issues? The "not your keys not your coins" take is hilariously dumb in light of how much "value" has evaporated in personal custodial failure. The currency and its supporting infrastructure has everything to do with it, and crypto fails basic litmus tests to even attempt to go mainstream.
You didn't read the entire article, did you? They go on to say that they are specifically different than crypto, because they are backed by a central bank. That makes a world of a difference.
The difference between a cryptocurrency backed by something and a MySQL database is that in the former case, underlying value is indeed centralized, but in the latter, both underlying value and the exchange of stake in that value is centralized.
Like chips in a casino can be exchanged with the house for cash, but I don't need to tell the house that I'm giving some chips to my friend.
The difference is that cryptocurrencies, in general, are being promoted as currency—something you trade for goods and services—not securities—something you trade for currency.
Crypto coins are securities. If you hold securities at your bank, they are not loaning them out and they have zero problems transferring all of them away.
Okay, but the fundamental difference is that cryptocurrency works as intended and provides value for an entire economy of people even during this experimental phase where we are still working things out.
This is arguably the same for a majority of crypto users.
I see crypto as a "digital asset". It's something you store funds in to hedge markets or get around transactional issues (either because you're doing something potentially illegal by some entities definition or because your currency is shot to shit), which basically makes it like golds or precious gems.
I'm not totally sold it'll last long term, but I don't see the comparison as a huge logic leap.
To many cryptocurrency enthusiasts, the fact that such an entity does not govern cryptocurrency is one of its main appeals. They're indeed different beasts but both lack an "intrinsic value": their value is entirely derived from the belief that they can be traded for something else eventually.
People would prefer to store crypto in the first type of institution.
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