Bad actors only get caught out if it it feasible to self custody. If the fees are so high that it's not possible then any custodian can make a killing by running a fractional reserve and bankrupt good actors. Bitcoin gets captured by the banks, just as if the block size was too large for non specialised people to run a node. 

If this happens I think Bitcoin will fail to dominate and we have an ecosystem of shitcoins 

 I’m wondering if there will be a way for proof of reserves to solve this. There might be a way to know say how much ecash has been issued and how much BTC is held in reserve.