A New Standard For Centralized Exchanges
FTX was the latest entrant in the hall of shame for centralized exchanges but it won’t be the last.
For those of us who’ve been here a while, it’s a familiar story. It follows Quadriga, MtGox and many more as the latest crypto Icarus, rising high and falling fast.
The fact that this tale rhymes with the past doesn’t make the tune any less painful though. As an industry, we need to finally mark this line in the sand and never take a step back.
“As an industry, we need to finally mark this line in the sand and never take a step back.”
We need a new standard. A new standard for centralized exchanges that puts users first by prioritizing and protecting their interests above all else.
Sovereignty. Ownership. Control. These are the core values of Web3 and they need to run through every protocol, app or service that users interact with.
That means no compromises — everything we build must be built for users first. You should control everything you own — data, assets, identity and more — and you should decide what you do with it. That’s what true ownership means. It’s a principle that needs to be the foundation of the entire ownership economy, so everyone can experience the full power of Web3’s potential.
Thinking about exchange operators specifically, these are tough times for those who want to do right by their users. Many know that the ownership economy is nothing if it doesn’t empower users and they want to build services with these values hardwired into their DNA.
But they also can’t deny how damaging these incidents have been. Users’ assets have been mishandled and gargantuan platforms have crumbled to the ground. Meaningful value has been lost forever and with it, the trust of many enthusiastic users. That’s a huge blow to the industry’s reputation and one that regulators can’t help but step in to sort out.
Let’s be clear though. All this drama does not mean we should be attracted by the siren calls for the end of centralized exchanges. We don’t need to throw the baby out with the bathwater.
“All this drama does not mean we should be attracted by the siren calls for the end of centralized exchanges.”
Exchanges have established themselves as the gatekeepers to crypto for many ordinary users. As the main way for most to move from fiat to crypto, they are well equipped to help. They take the best bits of Web2 to make the user experience seamless and enjoyable.
The problem is some have fallen into that familiar Web2 trap, shutting out the competition and exploiting users for all they can, rather than empowering them with ownership and control.
Some will say DeFi is the answer and who can deny this financial revolution hasn’t proved itself during testing times. We should recognize there’s much to learn from these pioneers.
But your average user — the ones who need to be onboarded if real mass adoption is to occur — aren’t ready to drive straight towards the bleeding edge of Web3. Most need a seamless experience and safeguards against the scams that proliferate the whole crypto ecosystem.
Flawed human behavior. That’s really what these catastrophic centralization failures boil down to. So let’s stop relying on the better angels of our nature to do the right thing when we don’t need to. We have a trustless technology that can do the hard work for us, setting a new standard for user sovereignty and asset ownership for everyone to follow.
It’s really simple when you think of it from the user’s point of view. Your assets, your ownership. Constant, unrestricted access with no small print and no strings attached. All wrapped up in a seamless user experience that rebuilds trust with every interaction.
This is the new standard.
At Cirus, we are working on something special with our partners that sets the new standard.
