A ledger balance at a bank is not fiduciary media. The medium by which you transfer these balances between accounts and banks is fiduciary media. You can transfer balances between accounts at banks by wire, money order, check, ACH, electronic transfer between internal accounts or BANK NOTES (a.k.a. US dollar bills). To get the dollar bills out of your account, you go to a teller and they give you bank notes.

Never did they give you silver or gold money from their vaults.

Yes, SN is a custodial wallet. It is possible that SN spends the bitcoin out from under the balances represented in our accounts. Yes, we could be sending sats back and forth without us ever knowing that @k00b is operating his service at fractional reserve.... That is until one day his balance goes so low that SN can't satisfy a request to pay an external lightning invoice. Then someone screams, "hey where is my bitcoin?" To everyone, and there is a bank run on SN.

This is the difference between fiduciary media and money. All are IOUs, but money is a hard asset. Bitcoin is a hard asset.