Should Bitcoin Exchanges Have 100% Reserves?
This piece was commissioned for the 8BTC special topic: http://www.8btc.com/caution-money After many quiet days, the recent plunge in Bitcoin has finally made the various communities lively again. Quite a few people have popped up to cry, curse, or else gloat for a bit; of course, there are also some calmer players who have come out to reflect on the issues, such as once again reexamining the question of whether exchanges should maintain 100% reserves. Markets rise and fall; that is perfectly normal. There is no need to make a fuss every time prices crash. Short-term coin speculators ought to welcome violent market fluctuations, while long-term hoarders need not care…
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