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 IMO your #2 incentives based system will happen inevitably. Like a new free banking system based on BTC. Some will be good, some will take too much risk, some will be crooks. If there are enough options then the good win out overall and the overextended/crooks fail often and early enough for the system to remain healthy on the whole 
 I somewhat agree: "trust somebody" can be quite efficient. But it's prone to bad incentives (undeclared fractional reserve) which can drive out good actors (who are not as profitable) *then* collapse. I know nostr:nprofile1qqs9pk20ctv9srrg9vr354p03v0rrgsqkpggh2u45va77zz4mu5p6ccpz4mhxue69uhhyetvv9ujuerpd46hxtnfduhsz9thwden5te0dehhxarj9ehhsarj9ejx2a30qythwumn8ghj7un9d3shjtnswf5k6ctv9ehx2ap09krt7g has thought about this a fair bit, and has a rotating ecash solution which may address it well enough? 
 Undeclared fractional reserve would definitely fall under the crook category- I’m certain that will happen somewhere in this market of “banks”- but at what scale? Am I naive in thinking there’s some kind of social layer within this community that would enforce transparency to allow a mint to even get large/popular enough to be systemic? Over-engineering “perfect” solutions and leaving nothing to the social layer comes with its own complexities, unforeseen consequences and never mind UX/scaling issues… 
 I’m also curious to learn more about this rotating e-cash though thanks for bringing that to my attention 🙏🏼 
 Here you go sir

https://gist.github.com/callebtc/ed5228d1d8cbaade0104db5d1cf63939 
 Rock on, thanks. Also listening to your recent ish pod with @ODELL right now and getting up to speed. We’ll be implementing e-cash at some point but clearly a lot to learn here 
Cc: @AceaSpades