As a anti-bankster citizen, I am a fan of the general concept of a decentralized currency and independence from financial institutions. I have been watching the development of bitcoin and other altcoins for a while now and finally decided to take the plunge into that world and go from a passive observer to a happy owner of a few coins. In order to do that I had to pick not only a wallet (or preferably two - hot and cold) but also decide on the exchange I would use to but the altcoins. Few major names came out of the research, yet all of them have quite a large amount of negative reviews. Honestly - if I wanted to invest a bigger amount, I would have a lot of doubts as to which exchange to use.
Bitcoin, blockchain and everything related to a code is based on rules, self-protecting and self-governing to a certain extent. Cryptos are based on decentralized systems and really giving the power to the people. Yes, I know we can speak of the 'Chinese monopoly' when it comes to mining but that still doesn't invalidate the concept of the egalitarian, accessible decentralized currency. Online exchanges on the other hand, are just private companies oriented towards profit. Centralized. Governed. Having to adhere to the local laws (naturally). OWNED by a group of people.
All the complaints and negative stories I read - are they all just competitions marketing? Do things happen because people try to commit fraud and when caught, turn their frustration against an online exchange? Are the online exchanges growing too fast, lacking personnel and having issues with their operational systems? What do you think the reason is?
All I know is that when companies grow and when they have monopoly for services or goods, they tend to disregard the welfare of their customers. Access to customer service becomes restricted, tickets remain unanswered and your account can be blocked any time based on the sensitivity of an algorithm rather than your actual actions. Will the online exchanges become the weakest link of the whole cryptocurrency phonomenon? Will the greedy human nature take over the idealistic concept of independent currency? Or is it just a hiccup on the way to adoption of cryptos by masses?
Decentralised exchanges and atomic swaps of which LTC to BTC is the first example I beliieve are the way. It's not safe to store a huge amount of crypto in any exchange and diversify the exchanges you use is a good practice.
I agree that these online exchanges are a necessary evil at least for now but I expect them to be deemed redundant in a couple of years
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