Thats what i mean. What is preventing the Bitcoin economy from becoming the shitty and evil thing our dollar economy is right now?
In the current system, you can lend out like 10x your own reserves. If there's a run on your bank, the central bank will print more dollars and keep you afloat. That can't happen in bitcoins, because there's no printing new bitcoins (above what mining does).
false. bitcoin banks can lend out 10x, too. if there is no minimum reserve requirement imposed on them, they can lend out 100x or 1000x if they want to - and if they find enough stupid people who deposit coins with them.
there is no "printing" involved when commercial banks create money. look up base money supply and the money multiplier.
money multiplier can be > 1 in a bitcoin economy, too.
factional reserve banking isnt a problem in itself. the problem is that govts insure the risks of it, so noone even cares where his money is deposited and what kind of stupid shit his bank does with it.