The assumption of crypto bank is wrong
The digital money is not as decentralized as people think. Today, numerous cryptocurrency exchanges offer a wide range of digital currencies such as bitcoin, ethereum, litecoin, etc. However, this doesn’t mean that users have to trust these vendors in the delivery of cryptos. In fact, these digital currency exchanges are mainly operating based on users’ fears and fears of the authorities. Let’s take an example: imagine that you and your friends have come up with a plan to buy some bitcoins from some third party service which offers you access to a virtual bank account where you can deposit your bitcoins when needed. You set up an account at this service along with your friends and hope for the best. When Bitcoin was launched in 2009, there were no platforms available to purchase Bitcoins from other means such as debit or credit card. As a result, people relied on third parties such as crypto banks (crypto exchange) to provide them with their required amount of bitcoins. This assumption is wrong because crypto banks do not issue virtual currencies like bitcoins but only accept them directly from merchants and hold them in physical vaults under lock and key (like custodians). Instead of trusting these crypto banks with your virtual coins, what if we told you that they are a tool used by lenders or some kind of financial scheme to leverage your money with worthless tokens? These exchanges issue virtual…
