There will always be bitcoin banks. I'm using one right now ... I have sats that I've earned here on SN held on my account here on SN. While not technically a bank, there's nothing stopping me from using it as one.

Could SN be fractional reserve on account balances? Sure. Would I know? Not until people start claiming withdrawal stops working. And by then, it's too late.

I don't think I've ever had more than $5 or $10 worth of sats on my SN account though. Not because I don't trust the site, .. but because with Lightning I can withdraw with trivial fees, as soon as I have a chunk of sats anywhere that I don't plan to immediately use, I forward them to my main wallet, and periodically I might swap those on-chain to my cold storage wallet.

But signing devices (e.g., ColdCard, Trezor) keep getting better and better (and easier and easier). And who knows if governments do a 6102 on bitcoin held at exchanges / "banks" / custodians / etc. It will just be expected -- self-custody essentially crucially necesary, so that's what we do.