How about this answer: discussing this is stupid, and the idea is wrong on so many levels.
The whole financial system is fucked up, end of story.
It's best we all understand WHY it's fucked up, otherwise you're just having "faith" that it's fucked up.
If everyone understands WHY it's fucked up then it will be good for bitcoin adoption and bad for any thief that aspires to start a bitcoin FRB.
Knowledge is power, OBTAIN IT!
FRB is an easy concept to understand:So you want to start a bitcoin FRB?
Get yourself 100 bitcoins.
Start up your FRB with a reserve ratio of 1:1....
1:1 token:bitcoin ratioin 1:1 mode of operation you are just a central bank.
Put bitcoins in a cold wallet with public address.
Create 100 altcoin tokens that represent the deposited bitcoins.
Users can swap (redeem) these tokens for bitcoin at any time.
Bank can loan 1 token out to someone for a year and collect say 10% interest on the loan.
You can share this interest with your depositors, (give them 8%, you keep 2%).
And so your central bank will grow.
Cold wallet will grow as people deposit their bitcoins and gain guaranteed 8% interest returns.
Let this run for a year or so, treat your depositors like gods, LET IT GROW!
IT'S ALL GOOD
> 1:1 token:bitcoin ratioHaving established your bank you can now increase the token:bitcoin ratio.
To do this you simply create new tokens out of thin air any time someone takes a loan.
Users can still swap (redeem) these tokens for bitcoin at any time.
But most users keep their bitcoins in the bank because they like the 8% per year interest.
You will need more borrowers to keep the growth.
You will have to reduce loan interest rates to encourage poeple to borrow instead of save.
You increase your token:bitcoin ratio as you grow.
You better hope all users don't want to withdraw at once or you're screwed (well they are).
If you feel it's about to collapse then you can just take the cold wallet and run...
ITS FUCKED UP
So any central bank will start with 1:1 ratio, then after it becomes trusted it will take advantage of that trust and slowly increase token:bitcoin ratio.
ITS A SCAM!Simple as that!