My understanding is that the FTX terms of use explicitly said customer funds would not be lent out? I agree that in fractional reserve banking, it’s conventional that banks do this, but FTX was an exchange not a bank.
And, as an exchange, it had none of the government-backed insurance that makes it safe for banks to loan money like that without risk to customers.
My understanding is that the FTX terms of use explicitly said customer funds would not be lent out? I agree that in fractional reserve banking, it’s conventional that banks do this, but FTX was an exchange not a bank.
And, as an exchange, it had none of the government-backed insurance that makes it safe for banks to loan money like that without risk to customers.