> BTC supply is capped. It's not.

Yes, it is. They are not introducing BTC into circulation. This is verifiable via the blockchain.

Banks creating IOU's or derivatives or whatever other abstraction they can come up with never generates new BTC. You'd hope that people foolish enough to work with such financial institutions would know the risk of possessing nothing but an instrument created by the bank. If you're unwilling to take custody of your own bitcoin, you better damn well do some good research on third party custodians.