Bittrex is going to shut down in 4th DEC, while it already shut down its US operations, It is also expected that BINANCE US will also shut down in the future, FTX failure crashed the whole market. If we observe the global cryptocurrency market, Centralized Exchanges are really finding it difficult to keep them afloat. With CEX under scrutiny by the SEC or their own malpractice pushing them out of business. With CEX is getting shutdown, will it impact crypto adoption?
How CEX helped in Cryptocurrency adoption.
CEXs provide convenience to get the crypto especially when you want to buy crypto using Fiat or a credit card. This is something that cannot be using DEX, a strong alternative to CEX. Since the user can directly convert Fiat to crypto with a credit card swipe and store it in their CEX account without knowing/understanding any blockchain and crypto principles this really helped the naive user also to get crypto.
So CEXs are really helping?
The convenience of buying crypto and storing it in CEX wallet caused the masses to understand it as only "get-rich schemes" and I guess most of them still keep themselves ignorant about the basics and keep the funds in CEXs. Keeping funds in CEXs is a real problem as CEXs start treating it as their own money and start spending and investing as they wish. Combined with their malpractices and bad/risky investments they lose their customer funds and it lead to their closure and filing of bankruptcy in the end. This affects the crypto market and crypto investors badly with nothing wrong in the crypto itself.
I guess this causes bad press and pushes users not to embrace and use crypto. If you lose your money due to company malpractice, definitely you might lose hope in the whole sector.
CEXs: For their profits.
As a corporate entity, they should be acting to preserve their interest and maximize their profit. They are not the actual torch bearer of the blockchain technology. I guess with their malpractices and creating more profit for themselves they have created more harm to the sector whether it was Mt.Gox in the past or FTX in the current.
DEX is a solution but ..
Using DEX is a solution to obtain one crypto for another but it does not solve the problem of getting crypto if you do not own any.
So, how do the earlier users get the crypto if they do not mine it? They simply got by providing their services and goods for crypto, one of the famous example is the buying of pizza using Bitcoins. If an ecosystem develops where crypto can be directly used for buying goods and services bypassing the fiat conversion, then it will be the best case scenario.
So we don't need Exchange.
I am not saying to eliminate them but I am stressing that user should get educated more and should not leave funds in exchange.
Crypto adoption will be more rampant and organic if it happens by peer-to-peer transactions for goods and services with crypto payments. This not only educates users more but makes the utility of crypto more. Platforms that promote crypto payments for goods and services are very limited and I guess working on this front will really benefit the crypto. With CEXs closing, if the attention and money is used to develop these platform instead of paying hefty fees for exchange listings , I feel the adoption will be more .
Posted Using InLeo Alpha
