Centralized Exchanges Are Becoming The Worst Enemy Of Crypto

cryptocurrency-3401844_640
via cryptopotato

As gateways to the world of cryptocurrencies, centralized exchanges have amassed large amounts of influence over the years. These companies control the power to make or break blockchain projects, and are usually the only businesses that remain profitable regardless of the volatility that the crypto market experiences.

All of this wealth and influence has led to serious unethical acts of market manipulation and exploitation that expose exactly why decentralized exchanges are needed now more than ever.

Roy Huang, Co-founder of Fresco Network, revealed on twitter yesterday that a top 30 ranked exchange had openly asked his company to use trading bots to create fake volume with 0 transaction fees.

https://twitter.com/akahry/status/1008519430735847424

The yet to be identified exchange promised to provide an “API & trading assistant to help achieve 50 BTC daily volume” and that they would even let the trading assistant (“a simple trading bot”) be a ‘market maker’ free of transaction fees.

The shocking implications of this are outlined in full detail by crypto Trader Silvain Ribes, where he believes “more than $3 billion of all cryptoassets’ volume to be fabricated”, and that OKex, the #1 exchange rated by volume is the main offender with up to” 93% of its volume being nonexistent”.

In addition, Roy points out the disturbing fact that the NASDAQ stock exchange only charges less than $200,000 for listing mega companies, while a lot of crypto exchanges are trying to charge more than $500,000 in listing fees.

Both of these posts are shared with the fitting caption – “Road of decentralization impeded by greed”.

As more crypto influencers like Joseph Young share the news, people all over the web are beginning to share the same sentiment, which is that centralized exchanges operate in the very same corrupt manner than any centralized organization with too much wealth and influence will do if unchecked.

Therefore, the need for decentralized exchanges like 0x or Blocknet are greater than ever, and these organization must quickly take the place of their centralized competitors in order for what Roy and others see as an “industry problem” to solve itself.

5 Likes

Roy needs to get over to Komodo sharpish…
seriously tho…this is exactly the problem. Exchanges have the destiny of crypto in their grubby hands…and they are doing exactly what grubby bankers do… :disappointed_relieved:
they take short term profit every time…
Take binance…7million extra customers…but trading less than dec 17… and they wonder why???
DEX are the future…ETF spot price needs to be DEX index related…
.as soon as they are grandma proof and take fiat watch these wash trade houses go down faster than a shitcoin in top gainers on cmc

3 Likes

Roy needs to get onto Yen.io :stuck_out_tongue:

Stay Fishy

3 Likes

Ask anyone who is a professional trader in any market (Stocks, commodities, ebay traders, futures, forex, bonds, pogs, crypto, etc) and they will tell you that there is a big difference between retail investors and institutional/market making traders. It’s not limited to crypto.

Professional traders make money on the spread/arbitrage - long term price is not of much interest to them.
Retail investors/buyers are mostly buying to hold or buying for utility.

That said - if any exchange is manufacturing 93% of the volume - that would be an issue. That’d be like Etsy buying 93% of all items on their marketplace.

3 Likes

whoa - didn’t realize that. Although the hysteria of Dec 17 could be an all time outlier. But still - 7M more customers and lower volumes ?!?

3 Likes

My opinion only: There are too many exchanges. Regulations that make law abiding people wealthy are in the offing. Consolidation is coming.

5 Likes

Not buying that Peter :slight_smile:

2 Likes

According to Andreas Antonopoulos there are not enough exchanges and should be at least 3 for every country, but what does he know?

2 Likes

My model for “ideal” is the number of Forex markets in the world. I have no idea what the count is. I do know though that it includes only efficient players, something I can’t imagine right now in crypto.

2 Likes

I think Andreas is more referring to things like E*Trade or TD ameritrade which are account holder and interfaces with the actual exchanges. I think this is where DEX’s will excel they will not be true exchanges but interfaces to multiple exchanges at once.

2 Likes

I’m trying to find the specific video on his youtube channel. However, the hardest thing I find to do on youtube is search for content inside a video. A feature that allowed me to search the closed caption text would be ideal in this case. That aside, until I find the actual video for reference, I recall he was simply referring to decentralization of exchanges being a requirement. The more exchanges the more decentralization. Also @Nekko is right, this was in reference to decentralized exchanges as the way forward. I’ll keep looking for the video for more context.

4 Likes

Cool look forward to seeing it. I have watched many of his video’s its just a matter of rewatching and gaining the context in which he was speaking about it.

4 Likes

💰 YEN · YouTube ·️ YEN.CAMP 🧠