You are assuming that the banks hold $0 when they go under so they FDIC has to cover everything. Most of the time the banks have MOST but not ALL of the money.
I don't think I made that assumption. Even if banks can cover 95% of deposits (which is a very generous estimate), FDIC insurance is still insufficient to cover the remainder. And often the money that the banks do have is prioritized for large corporations and entities, while average users (the exact ones who are holding amounts covered by the FDIC threshold) are the last in line to receive anything.
so if that's the case why feel sorry for them if the dollar goes to 0?
I don't. I care about the fact that all my family and friends who don't own bitcoin will lose everything if the dollar goes to zero.
well europe tried doing that with the "euro" i don't think it really had any affect on the us dollar. but we'll see
European countries did not tend to trade in USD prior to the euro. They generally traded in their own currencies, British pounds, or Deutsche Marks. Countries like India, China, and Russia have used the dollar for international trade for decades. It looks like that will soon end.