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In response to the 2012-2012 financial crisis in Cyprus[1], the Cypriot government decided to take 47.5% of uninsured deposits over the amount of €100,000 in the Bank of Cyprus, and all deposits over the amount of €100,000 from the Laiki bank. Greece did something similar with their bonds.

"Haircuts"[2] are regularly floated as solutions in financial crises. Just because it didn't happen during the last crisis, doesn't mean that it won't happen during the next.

[1] https://en.wikipedia.org/wiki/2012%E2%80%932013_Cypriot_fina...

[2] https://en.wikipedia.org/wiki/Haircut_(finance)




Conversely if your house burns down 100% of the money under your mattress is now worthless.


I have a cache of money from Switzerland that became worthless recently (well, I can still exchange it at the Swiss National bank someday). That kind of hurt. Also, I have some Indian money that is definitely worthless no matter what now.




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