The Curse of Centralized Crypto Marketplaces
Why are we against centralized crypto companies and how are they ruining the ecosystem?
Has your grandma ever asked “what is crypto” or “how to buy crypto”? If YES, she has probably saw some crypto advertisement. Centralized crypto companies have spent billions of dollars in marketing bizarre campaigns, from endorsing Ronaldo to sponsoring 70% of F1 teams, they have done it all. These flashy campaigns give a perspective that they are big, trustable and cash-rich. No doubt Binance, Coinbase, FTX and others have played a key role in educating and bridging folks to the decentralized world.
But, Shakespeare once rightly said “All that glitters is not gold” — which perfectly resonates with the current crypto landscape. No matter how much these companies claim to be transparent and bright from outside, it is a fact that they are equally opaque and dark from the inside. When entrusted with our money, these platforms either try to scam or trade against us resulting in major financial losses.
How do you think FTX, Celsius and others went bankrupt? These companies were actually a ticking time bomb in years of making due to mismanagement of users funds and illicit trading activities. Even a former Coinbase manager was sentenced for insider trading. These kind of cases pop up time to time, making insider trading pretty normal play in the ecosystem. Binance, Coinbase, OKX, Bybit and others are the places you need to keep your grandma away from!
Centralized crypto companies are like your toxic ex that initially helped you and made you socially acceptable. However now you are uncomfortable because they have total control over you and you feel the urgency to escape but you don’t know how to. This is exactly how users in India and most parts of the world currently feel. These companies attract users to deposit funds with huge offers and advertisement. But then make it as hard as possible to withdraw back their assets by rejecting, delaying, and charging huge fees on withdrawals.
Bitcoin ETFs are considered to be a very positive outcome and is celebrated by many in our industry. But in reality this is just another step back when analyzed properly. Blackrock now owns 1% of the total Bitcoin supply. Many such hedge funds hold similar large amounts, again making it more centralized and in control of very few individuals.
We should remember why the crypto revolution started in the first place. Satoshi had a vision to make a trustless and transparent economy free from centralized control. Only for us to end up falling back to our old ways and defying the very purpose of crypto. We need to take a step back and realize how we as a community have lost it’s initial goal.
At Defy, we want to make DeFi the norm for online finance. Your crypto superapp that makes you forget if you are using a app or a dapp.
FINAL THOUGHTS
Bitcoin’s motive was to defy the traditional financial system and create a trustless, transparent and open economy. But due to ease of use centralized crypto exchanges took over, which are again prone to problems like hacks, single point of failure, insider trading, centralized control and others. We as a community need to understand the true potential and motive behind decentralized finance and make our move.
