To be clear, this is not an analogy. I was describing the process by which commercial banks create money out of thin air. And the same exact process can be used by exchanges to create bitcoins out of thin air. There's nothing special about bitcoin that prevents this money-creation process from working. It works with any asset. It works with commodity-backed money as well. And you don't know that this isn't happening right now, because not all Bitcoin exchanges are audited. It might very well be the case that bitcoins are being created out of thin air right now by some exchanges, thus inflating the global supply of bitcoins. You have no way of telling. Also you don't know whether this is illegal. These exchanges could be in a jurisdiction where it is legal, and it would still affect the global supply of bitcoins.
