Can someone please explain to me the difference between the FRN (green seals) and the Federal Reserve Bank Notes (Brown seals). My assumption is (based on what I have read) is the Federal Reserve Bank notes are similar to National Bank Notes in the sense that the issuing banks had funds deposited in the treasury that backed the paper money they issued. If that is the case, this would not be fiat currency (correct?). Therefore...the Federal Reserve Bank Notes and the National Banks Notes are quite similar in how they were issued and backed by they were issued by different types of banks (created by different laws). On the other hand, Federal Reserve Notes are backed by the treasury as a whole and not one bank? Am I on the right page here or am I way off???
The Federal Reserve Bank that issued the note, not the Federal Reserve System, was obligated to honor this note. The note indicates, "Secured by United States Bonds deposited with the Treasurer of the United States of America or by like deposit of other securities." Federal Reserve Notes are backed by faith in the United States.
