I asked some time ago but get no useful answers. What is the main conceptual difference between Bitcoin(cryptocurrencies) exchange and fiat-exchange? I get something about safety. It was like " in bitcoin exchange - there are no secure, no safety" explanation was not clear. I never traded Forex or New York Stock Exchange so could you explain me in simple words like:
In New York St.Exchange nobody want to kill you, in Bitcoin world - everyone.
Summary: I'm looking for conceptual difference between Bitcoin exchanges and fiat/stock exchanges. Could you the newbie?
Thank You
Most fiat and stock exchanges are regulated by governments and must follow a long list of strict rules to protect the users. They also are typically audited by independent third parties and are usually insured.
Bitcoins exchanges are unregulated, uninsured, and are not audited. If you use a bitcoin exchange, you are hoping that they will act in a trustworthy manner, but have no way of knowing if you will ever get your money back.
Other than that, mechanically they essentially work the same way. The exchange provides a market place for buyers and sellers to find each other and maintains an order book to provide the necessary public information for price discovery. The exchange handles the transfer of fiat and bitcoins between the buyer and the seller. For providing this service, the exchange charges a fee.
