Topic: CEX ruins the true value of Bitcoin - page 5. (Read 722 times)

The issue is simple and has been discussed many times before. It is the reverse of how the OP puts it.  If Bitcoin is mass adopted and someday reaches $1M in price it will be in part because of CEX and custodial wallets, not the other way around.

I would qualify and say that CEX ruins the original idea of bitcoin to be a P2P electronic cash system, but there are inventions that evolve and succeed beyond the original idea of its creator.

Those who want to use Bitcoin with maximum room for privacy will be able to do so, but they will be in the minority, and at least that's the way it is today.

Mass adoption will come together with governments regulations and CEX, and not against them, despite the original idea of Bitcoin.

CEX are proper businesses set up with proper physical legal addresses which you can file law suits against should they wrong you.
DEX are random individuals hiding away behind tor and proxy and virtual mail/PO Boxes which if they should wrong you, your just lost and no way to claw back anything

CEX are also easy to find on the internet, and have had years of reputation.
DEX are hard to find and even harder to trust

..
dont worry about volume
when an exchange does a arbitrage. it may only have say 100btc involved. but when it sidechain swaps to another exchange, plays on that exchange and then tethers back to then buy coin and repeat every minute. that 1 allotment of 100btc can be seen as being 10,000btc volume due to arbitraging 100 times a day. even though its only 100btc being spend repeatedly


its like looking at bitcoin network 'btc transaction value' per day.
when people re-spend the same allotment of coins by spamming the network EVERY BLOCK that single coin. appears as 144 coins a day.
in short.. volume is meaningless as it does not explain who/how much//how often individuals actually spend individual funds

even things like exchanges just moving funds from cold to hotwallet where its not 'spending' but just organising its own wallet holdings. it appears on the network as thousands of coin 'volume'
EG the 'whale alert' twitter bot keeps announcing whale spends of thousands of coins.. where reality is its just an exchange organising its custodial funds.

so dont put too much thought into the value of the volume statistic

What is interesting, however, is that despite people supporting Bitcoin they are also supporting centralized exchanges and custodial wallets and all things that are essentially against the Bitcoin standard. So perhaps we could ask whether the people really prefer complete independence. For many years, DExes are left behind by CExes in terms of volume. Moreover, despite compulsory KYC hassles and failing a number of times in the process, centralized exchanges are not losing popularity. Is it only because DExes don't support fiat? Or is it simply because CExes are generally better? Or perhaps people aren't really interested get out of fiat altogether?

the issue is simple
if you want to use any service that handles fiat in exchange for another currency(any currency) that service has to register as a Money service business, thus need to create a policy to KYC their customers and monitor for AML and other criminal usage

just because coinbase also handles bitcoin. does not mean coinbase can avoid its fiat requirements/obligations

what you will also find is that if there is any service offering DEX, where fiat is also involved, governments can set up 'honeypot' traps to get evidence that an individual is running an exchange business without a licence. and punish them.
its happened many times with 'localbitcoin' users

so dont think that DEX is default outside of the jurisdiction of fiat laws. because those individuals handling exchanges fiat for a fee will need to register or try extra hard to hide their identity(kind of hard when doing bank transfers)

.. currently exchanges that just do 'swaps' of crypto-to-crypto dont have to abide by money laws. but that may soon change especially when more and more governments are legalising bitcoin as a asset currency, rather than a merchants good/product

yep. by states offering the ability to pay taxes in bitcoin, is a round-about way to slip in bitcoin as 'money' to then gain jurisdiction to then set more laws

At times due to the rules and regulations of certain countries, CEX used to ruin the value of bitcoin. This means these exchanges completely outlaw the reason for which people prefer bitcoin as well as the reason for which bitcoin is being innovated. Coinbase, one among the leading exchange in terms of volume have come up with requirements of recipient information for crypto transfers from users in Canada, Singapore and Japan.

• For Canada the limit is $1000CAD, fow which it requires the recipient information. This new change comes to effect from April 4, and this change is with regards to the Canada's FINTRAC rules.
• For Singapore users, for each and every transaction it requires the recipient information along with country of residence. This comes to effect from April 1, change is following the Singaporean regulations.
• With Japan complete information of the recipient name, address and country of residence is a must. This is according to the English translation of rules established by the Japan Cryptocurrency Trading Association (JVCEA). This will take effect on April 1, said the coinbase.

Recipient Information Required for Crypto Transfers From Users in Canada, Singapore and Japan

We aren't compelled to make use of these exchanges, it is possible to use the non custodial wallets. However this Exchanges might turn to be similar service providers of banks in future while sticking to the rules and regulations.