What makes a transparent crypto exchange.

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Quote from: Phoenixtrader on September 16, 2024, 04:16:39 PM

But they scream not your keys, not your coins and they don't use it .

1. Bear in mind that the above comment I made was not based on actual researched numbers but my inference. It is not factual.

2. Majority of people do not actually post, Not you keys; not your coins, and very possibly most that post that use DEXes.

3. That phrase is mostly used when telling people not to "store" their funds on centralized exchanges. There is an obvious risk however you use a centralized exchange, but only keeping your funds there for the duration of the trade you're making and withdrawing back to a non custodian wallet reduces the risk you are exposed to. From my inference, many on the forum do this.

4. The message is the most important factor. If someone advises you to protect your wallet properly and doesn't do same for theirs, will you for that throw all security caution to the wind? I'm sure not, so apply the same logic here. If you can trade solely with DEXes and always stay in control of your funds you are protecting your funds better

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Quote from: CryptopreneurBrainboss on September 13, 2024, 01:32:34 PM

Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

I know many of us use Dex here, but this is an important discussion worth having.

Honestly many of us don't, they speak good about them but they don't make use, making most DEX to have low trading volume.

The last time I can say lots of users were using DEX was during the era of defi domination of the industry market shares but all the hypes is dieing down.
Aren't you seeing the volumes CEX are pulling (although the numbers are being manipulated but they aren't that far behind).

Well we have to give up for DEX as they're in an industry dominated by CEX which shouldn't be the case but that's the reality.
Transparency isn't what most people are now looking for, they're going toward trust which the CEX are taking an advantage of. Provided they can look trustworthy, they'll get a large share of the market and then they can do whatever they want and get away with it although few pay the price. FTX is a perfect example.

I just said same thing. If we scream not your keys and not your coins and turn to use cex then there's a problem. From reports on cmc CEX are dominating..probably because they're trying to make users trust them.. compliance, Merkel tree & POR, protection funds..keeping up to date & communicating with its users constantly..not all exchange does this though, but I follow the transparency report of Bitget monthly and I can say it's a commendable effort. About DEX. what do you think should change??

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Quote from: Upgrade00 on September 13, 2024, 10:30:25 AM

Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

I know many of us use Dex here, but this is an important discussion worth having.

I don't think many use DEX here actually. There's no way to know for sure but I'm of the opinion that majority still lean to the convenience that CEX offers.

Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

For users, a crypto exchange’s transparency should be a key consideration when choosing where to trade. So, what exactly makes an exchange transparent?

• Being open source,
• Not holding user funds,
• The above requires them to the P2P,

Centralized exchanges cannot be transparent so they rely on being popular and building a good reputation. That way they hope users will trust them to keep their funds safe cause they have been doing it successfully for a period of time.

Always remember; Not your keys, not your coins.

But they scream not your keys, not your coins and they don't use it .

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Quote from: Stalker22 on September 15, 2024, 02:39:28 PM

But even so, there is no guarantee an exchange wont try some shady stuff. You are always taking a risk when dealing with centralized crypto exchanges.

Centralized crypto exchanges are businesses. Transparency isn't their priority. To a certain extent, transparency could even be shooting themselves in the foot. Their brand's image is their primary concern regardless if it's inaccurate or even a blatant lie. That's what brings them customers and therefore revenue. Trading volume, number of users, reserve, years in operation, and other figures have to be high. Otherwise, they might create a bad impression.

If we notice, even new exchanges are claiming to have millions of users, hundreds of millions, if not billions, of 24-hour volume, and so on. You'd be amazed to know that of the 251 spot exchanges listed on CMC, some of the bottom 50, even 20, have more than a billion in 24-hour trading volume, higher than some in the top 5.

Even exchanges' features have to be misleading to create a nice brand image. Many have false claims such as decentralized, cheap, non-KYC, instant, and so forth.

So, what makes a transparent crypto exchange? If they stop all their lies.

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Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

The blockchain space was built on principles of transparency and fairness, yet not all exchanges uphold these values. In today’s landscape, transparency is more crucial than ever, as shady operations can threaten the survival of many platforms. For users, a crypto exchange’s transparency should be a key consideration when choosing where to trade. So, what exactly makes an exchange transparent?

exch seems to have moved in the direction of transparency. The status of reserves for all currencies listed there can be seen at any time on the site. Usually, we find out about the reserves of some exchanges only after a hack and after we hear how many funds were stolen from them.
Important or not, it is good to know the general liquidity of an exchange.

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I think the issue here is that some people are pretty naive and take stuff at face value. They wont bother double checking things exchanges claim. They just see the shiny, flashy website, and thats good enough for them.

Obviously transparency matters, but that alone doesnt cut it. Exchanges could manipulate data and numbers, hide extra fees or just outright scam people. So dont blindly trust whatever an exchange says.

What makes one really transparent then? For starters, listing all fees clearly upfront. Giving access to live order book data. Getting regular independent audits done. And having a solid track record of fair and honest practices.

But even so, there is no guarantee an exchange wont try some shady stuff. You are always taking a risk when dealing with centralized crypto exchanges.

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UNI is transparent, all transactions you do there can be seen on the blockchain anyone can see where your tokens go and where. There is;t a centralized exchange that will show all the transactions like UNI and its likes such as the 1nch.

However, you are a trader and couldn't really see the buy/sell orders if this is what you mean by being transparent. UNI is a swapping platform and a user who wants to execute a trade on the platform can only approve or not what the platform presents when it comes to the rates.

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Quote from: coin-investor on September 14, 2024, 11:35:22 PM

Decentralized exchange is the opposite of centralized exchange, they usually do not have licenses; everything here is automated; you just need to trust it and connect your wallet and sign it for you to do a transaction in the Decentralized Exchange environment.

Not all decentralized exchanges require you to connect your wallet to make a transaction. They all have different levels of decentralization and transparency.

Quote from: coin-investor on September 14, 2024, 11:35:22 PM

For you to trust a decentralized exchange

An actual decentralized service does not need trust. They do not have any access to your funds at any time and only mediate between both parties. You don't need to trust, just verify their source codes.

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Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

So, what exactly makes an exchange transparent?

If you read a lot you will have extensive additional knowledge regarding the benefits of crypto exchanges regarding the importance of the word transparent in crypto exchanges.
For example:

Quote

Transparency is the extent to which investors have easy access to required crypto or crypto type price information about an exchange firm, such as price levels, market depth, and audited crypto price reports, Investors also need transparency with investment exchange companies and funds regarding the various fees that will be charged to them.

Transparency helps reduce uncertainty and erratic stock price fluctuations because all market participants can base value decisions on the same data.

Price transparency is the extent to which all information regarding stock prices (such as bid price, ask price, and trade quantity) is available to traders on crypto exchanges.

So there are many other things or factors that can be understood about transparency in crypto exchanges, I think the quote above can at least add information about the importance of transparency in exchanges for investors and crypto users as a whole.

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Decentralized exchange is the opposite of centralized exchange, they usually do not have licenses; everything here is automated; you just need to trust it and connect your wallet and sign it for you to do a transaction in the Decentralized Exchange environment.

For you to trust a decentralized exchange, the exchange should be audited and trusted by market aggregators to include it in their lists of decentralized exchanges. There are a lot of new and up-and-coming DEX but those which earned the trust of the community should be the ones on your priority list should you opted to transact using a DEX.

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Quote from: R1dwanRz on September 14, 2024, 06:27:46 AM

Well after what FTX did, users lost all trust in using CEXs. Exchanges started to work and build up that trust over time, publishing transparency reports like proof of reserves or user funds protection measures, including more & more security into their protocols. If I were to give you an example, Bitget is the exchange, not only does it provide regular proof of reserves but it also maintains a $400 million protection fund to ensure user funds are safe, consistently staying above the promised $300 million mark since its inception. I really believe these efforts are helping to restore confidence in centralized exchanges.

Before FTX saga there was the Mt.Gox saga but a different story with Mt.Gox getting hacked while that of FTX is actually pretty a scam pull up but on both occasions customers of this two exchanges lost their funds that are yet to be recovered. For a transparent exchange the proof of reserves of SAFU (secure assets funds for users) are set aside to show the exchange commitment to its users that their funds are safe no matter happen, although this doesn’t add much weight when we talk of talk transparency we all know they don’t keep to their words when the exchange gets hacked,

Things about transparency has been listed above first been that they should be decentralized and open source, o think most exchanges are not truthful about been decentralized we have exchanges that started off as decentralized exchanges but later forced there customers into providing KYC details with their coins held until they got verified, my advice is the only decentralized platform is your cold wallet.

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Quote from: The Cryptovator on September 12, 2024, 03:56:39 PM

It's pretty simple, DEX should be open source. There is no alternative to being transparent on decentralised exchange. It's a very sensitive issue when you are connecting your wallet to any site. If you can't trust them, then you should be able to read their codes. When they keep open source and publish the source codes, you or another developer could verify whether there is any backdoor on it or not. So this is the only way to be transparent for DEX. Weak codes would also make it easy to hack DEX. So everything should be published so users know better whether they like to use it or not.

Coding is something a lot of users don’t know how to go about it and with its relevant to the verification on transparency of DEX, it’s much easier to stay clear. Having to connect your wallet, not a chance, it’s extremely rare for such trust and reliability on an exchange. Explains, why, most cryptocurrency investors don’t use it, it’s not easily understood.

For CEX, you’re just left with dependency and that’s it. A faith in them to do the right thing based on their certification and reviews on them. It’s been accustomed to by users due to its user friendly field and nothing more. You really haven’t got much in CEX except for the charges on transactions and the fact that, you can transact within the exchange and not be charged. Basically, they’re T&C and certification/registration.

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Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

I know many of us use Dex here, but this is an important discussion worth having.

The blockchain space was built on principles of transparency and fairness, yet not all exchanges uphold these values. In today’s landscape, transparency is more crucial than ever, as shady operations can threaten the survival of many platforms. For users, a crypto exchange’s transparency should be a key consideration when choosing where to trade. So, what exactly makes an exchange transparent?

Well after what FTX did, users lost all trust in using CEXs. Exchanges started to work and build up that trust over time, publishing transparency reports like proof of reserves or user funds protection measures, including more & more security into their protocols. If I were to give you an example, Bitget is the exchange, not only does it provide regular proof of reserves but it also maintains a $400 million protection fund to ensure user funds are safe, consistently staying above the promised $300 million mark since its inception. I really believe these efforts are helping to restore confidence in centralized exchanges.

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Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

I know many of us use Dex here, but this is an important discussion worth having.

Honestly many of us don't, they speak good about them but they don't make use, making most DEX to have low trading volume.

The last time I can say lots of users were using DEX was during the era of defi domination of the industry market shares but all the hypes is dieing down.
Aren't you seeing the volumes CEX are pulling (although the numbers are being manipulated but they aren't that far behind).

Well we have to give up for DEX as they're in an industry dominated by CEX which shouldn't be the case but that's the reality.
Transparency isn't what most people are now looking for, they're going toward trust which the CEX are taking an advantage of. Provided they can look trustworthy, they'll get a large share of the market and then they can do whatever they want and get away with it although few pay the price. FTX is a perfect example.

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Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

I know many of us use Dex here, but this is an important discussion worth having.

I don't think many use DEX here actually. There's no way to know for sure but I'm of the opinion that majority still lean to the convenience that CEX offers.

Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

For users, a crypto exchange’s transparency should be a key consideration when choosing where to trade. So, what exactly makes an exchange transparent?

• Being open source,
• Not holding user funds,
• The above requires them to the P2P,

Centralized exchanges cannot be transparent so they rely on being popular and building a good reputation. That way they hope users will trust them to keep their funds safe cause they have been doing it successfully for a period of time.

Always remember; Not your keys, not your coins.

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Quote from: Wiwo on September 12, 2024, 03:28:18 PM

DEX means decentralised exchange meaning that their operate without any regulations or service and provides privacy for their users since customer of DEX exchange are not required to pass through the kyc process and other anti money laundering requirements, and so DEX is a kind of of out of regulatory control, so for that the only reputation is the trust that the customer have on such exchange and their long term operations.

This is the truthful thing about DEX but we're seeing a shift here. Despite that being classified as a decentralized exchange, things have changed so far. It's no longer that most of them are transparent and can bypass regulations that the government implements. I've seen known exchanges in the past that have been liked by the community for being a dex but then released a token and shifted into being a semi-dex but I don't know if that still exists nowadays. What we can guarantee is that with government's intervention, nothing is going to last for being decentralized if it's a service type like an exchange.

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It's pretty simple, DEX should be open source. There is no alternative to being transparent on decentralised exchange. It's a very sensitive issue when you are connecting your wallet to any site. If you can't trust them, then you should be able to read their codes. When they keep open source and publish the source codes, you or another developer could verify whether there is any backdoor on it or not. So this is the only way to be transparent for DEX. Weak codes would also make it easy to hack DEX. So everything should be published so users know better whether they like to use it or not.

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Quote from: Phoenixtrader on September 12, 2024, 02:29:33 PM

I know many of us use Dex here, but this is an important discussion worth having.

The blockchain space was built on principles of transparency and fairness, yet not all exchanges uphold these values. In today’s landscape, transparency is more crucial than ever, as shady operations can threaten the survival of many platforms. For users, a crypto exchange’s transparency should be a key consideration when choosing where to trade. So, what exactly makes an exchange transparent?

DEX means decentralised exchange meaning that their operate without any regulations or service and provides privacy for their users since customer of DEX exchange are not required to pass through the kyc process and other anti money laundering requirements, and so DEX is a kind of of out of regulatory control, so for that the only reputation is the trust that the customer have on such exchange and their long term operations.

And if anything goes wrong, the customers will have to bear they lost because most times those exchanges are without physical representations or licenses.

But if it a centralised exchange (CEX) and is sure to at least build confidence in the system most especially those that are approved by the sec to operate as a financial service providers, so the safety comes from the licenses a d taxation process, so their are rooted in the ground and at that can not easily become a scam or do an exit scam on their clients.

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I know many of us use Dex here, but this is an important discussion worth having.

The blockchain space was built on principles of transparency and fairness, yet not all exchanges uphold these values. In today’s landscape, transparency is more crucial than ever, as shady operations can threaten the survival of many platforms. For users, a crypto exchange’s transparency should be a key consideration when choosing where to trade. So, what exactly makes an exchange transparent?

Topic: What makes a transparent crypto exchange. (Read 188 times)