The federated are given a kind of btc paper called fm-sats.
When someone from the federation wants to pay a merchant outside of it, what he does is "sell" the corresponding amount of fm-sats, and the federation sends the merchant real sats.
It is impossible to control that the federations do not issue more fm-sats than the collateral they have, then secondary markets for fm-sats are organized and thus we already have much more paper sats than real sats.
Exactly what the banks did in the days of the gold standard.
BitcoinLoveLife
npub18sy…as6c
2023-02-16 19:47:53
in reply to nevent1q…awv9
Author Public Key
npub18syds480djrtrhq3zk0a40qfyz02awsp0yxwje5sc4tc0khncs2sd7as6cPublished at
2023-02-16 19:47:53Event JSON
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"created_at": 1676573273,
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"content": "The federated are given a kind of btc paper called fm-sats.\nWhen someone from the federation wants to pay a merchant outside of it, what he does is \"sell\" the corresponding amount of fm-sats, and the federation sends the merchant real sats.\n\nIt is impossible to control that the federations do not issue more fm-sats than the collateral they have, then secondary markets for fm-sats are organized and thus we already have much more paper sats than real sats.\nExactly what the banks did in the days of the gold standard.",
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