Bitcoin Forum

Some countries already blame crypto for their economic woes. We saw this with the harassment of some crypto executives and even jail terms for some. What will happen to Bitcoin and other cryptocurrencies if most countries ban centralized exchanges? What steps are the crypto enthusiasts taking to preempt this?

Among 195 countries in the world, over 180 countries support bitcoin and altcoins in one way or the other that people can buy and sell them. If cryptocurrencies are still existing, all centralized exchanges can not be banned.

There are also other ways to trade cryptocurrencies if centralized exchanges are banned. There are decentralized exchanges and there are trading between people without exchanges involved.

It will be a good thing because eliminating centralized exchange mean encouraging people to use DEX or P2P.

I will be very happy if most country choose to ban centralized exchanges, this would strengthen the decentralization and the market will be mature because they will learn how to self custody their coins. There have been many centralized exchanges getting hacked or bankrupt, the victim will say Bitcoin is scam if they hold the coins in CEX, unfortunately most people never learn about it.

BTC and other popular cryptocurrencies would fall in value for a certain time period after which they would rise back again if such a situation were to ever happen and history has clearly proven that.

This is why crypto enthusiasts don't require to take any steps to tackle this stuff since world governments can't take down BTC and other popular cryptocurrencies no matter what.

If centralized exchanges are banned, it will be a big problem for traders and those who are keeping their coins in CEx. However, it will be the best thing that will happen to bitcoin because automatically, the government have helped to promote self custody and the use of bitcoin in a decentralized way.

Decentralized exchanges are there for people to use to trade their bitcoin to fiat. Physical p2p will also be used. I have a mall where trade my BTC to the manager.

Since you apply creativity to writing, you could consider what would happen if banks were banned, while you're at it. CEXs collaborate with the system and the political power, just like banks. The probability of them being banned, especially worldwide, as _act_ points out, is close to 0.

Bitcoin existed before Bitcoin exchanges did, so there's no problem. You can just buy goods and services with Bitcoin, adding a fiat middleman is just friction.

Logically, will people who do not use crypto always be prosperous and not miserable by relying solely on fiat money whose value is completely uncertain and even goes down? And if there are countries that consider crypto to be a bad thing and punish crypto users based on their misery, what about the people who have succeeded through crypto with the financial freedom that has been abundant in their lives? Will they also be punished even though we only show them as real examples for such clear proof?

I think that currently there are still countries like that, maybe these countries are led by people who are technologically illiterate and don't want to accept the latest technological developments through anything, including through crypto. Because misery or distress is a pure thing that arises from each of us, so no one should blame one thing, such as crypto or anything else. Another example is when people get drunk because of alcoholic drinks, should we blame the drink maker by not seeing ourselves as those who drink it?

The system allows CEXs to exist, but it also has the power to ban them, so although the chances of that are very small, I think they still exist in a scenario where some world governments would decide to deal with cryptocurrencies by declaring them illegal. This will not happen as long as the main focus is on trading, and minimal on using cryptocurrencies as a means of payment.

We will definitely see some price fluctuations as people move their coins from cexs to dexs. Some might even take out their coins in fear. They might be scared of what this implies for crypto in their country and steers clear of anything related to it.
We should encourage most crypto users to instead use decentralized exchanges in the first place. Bitcoin is decentralized and it must be treated as such.

I haven't seen this kind of news before that a country blames crypto for what's happening into their economy when they're not wholly adoptive with crypto.

Then we'd go fully P2P. That's the way to go and there won't be any issues with that if most of the traders and investors of this community will just have to trade through P2P platforms. And I guess that the emergence of decentralized exchanges will come but we might see some adoption through those dexes having Bitcoin and I think they will be able to do that.

But that will certainly never happen although it is the scenario that privacy and decentralization enthusiasts dream of. And what is happening is the opposite, the government even supports centralized platforms because through them they can control and manage investors like us. And with the recent attempt to attack mixers, I fear that in the future DEX will be their next target, don't be naive to think that they will support DEX and P2P development when neither of them will be beneficial for them.

Just because some governments have failed to control and operate their economies, they have no reason to blame and they are looking to blame centralized exchanges. That doesn't mean the rest of the countries are doing the same stupid thing. I guess the OP is talking about the Nigerian government with their recent accusations about centralized exchanges.

Nothing bad will happen, people will find a way to trade p2p on decentralized exchanges and that is much safer way than using centralized exchanges.
They can't ban all exchanges in every country because they already made them legal just like bitcoin, and they want to earn tax money coming from them.

I guess he's from Nigeria and was talking about their government blaming crypto and Binance for the devaluation of the naira. If this is what he means then as far as I know, only the Nigerian government is making these stupid accusations and no 2nd country is doing this.

https://www.binance.com/en/square/post/6637460411233
https://i.ibb.co/vwfmc3D/15-47-BTC.png



One thing we forgot was that the satoshi that created bitcoin was a peer-to-peer currency, meaning it was not dependent on any centralized platform in the early days. Having centralized exchanges will help more people have the opportunity to access bitcoin more easily, but that is not the factor that helps bitcoin survive. So whether there is a centralized exchange or not is not an issue for bitcoin.

I knew about Nigeria being too strict with Bitcoin and exchanges but not to that point that they're blaming crypto about their economic downturn. But thanks so, I understand now why they're putting the blame on Bitcoin with what's happening on their own fiat money.

Yeah, almost forgot that but I think that OP and the others priority is to convert it into fiat and that's the concern IMO. But then, you're right that even without them, Bitcoin will remain Bitcoin and it can be continuously be used for transactions even without the usage or existence of these centralized exchanges. Like what's the historical purchase of Bitcoin pizza by laszlo, that's one perfect example but I guess that as year passes by, the narrative changes a lot.

Bitcoin and alternative cryptos are nothing without the existence of centralized exchanges. Even though we're in the modern Dex era still we used to trade in the CeX and we rely mostly on them. As the way we can't define pen without paper similarly Trading without CeX will be stubborn. As of today, we have various exchanges albeit the Top 15 ones including Binance, Kucoin, Bybit, Gate, Bitget, Mexc, Kraken etc. are indispensable. If all the countries step up to ban centralized exchanges which is not possible, still they'll be just restricting us from being open to transactions, on the other hand, we move forward with P2P which can lead to many unlawful acts hence being friendly and legalised it will be a smart move instead banning. 

Which country blames crypto for their economic woes? Crypto can't destroy the economy of any country, if anything, it will only improve, El Salvador is a clear example of that. On the other hand, centralized exchanges are a different story. Countries complain that centralized exchanges aren't as regulated as other financial institutes, users don't have high security with them and many countries worry that centralized crypto exchanges might be laundering money too but this doesn't mean that centralized exchanges will be banned. I think that if any exchange is banned, it will be decentralized exchanges but at the moment they aren't as popular as CEXs, so they don't attract as much attention. Btw centralized exchanges will be more regulated and in close relationship with the government and national bank, they won't be banned.

It's extremely unlikely that all countries will ban all centralized exchanges, but if it were to ever happen, I believe it'd just make a lot of noise at first. People with genuine interest in cryptocurrencies wouldn't bait. There are decentralized exchanges like Bisq, which cannot be shutdown.

You cannot stop people from trading their currencies. The price would tank, though. Rest assured.

Although I agree a bit with you regarding the fact that CEX has its role to play in the cryptocurrency trading ecosystem and them banning it will cause a short term FUD among investors or traders but I will say that Wouldn’t be the end of trading to other currencies. The thing is many people think the decentralized exchanges lack liquidity and sincerely there is no denial about that. But once we have the CEXs in trouble many people will move to DEXs which will definitely hair gives it more liquidity than in the past.

The only set of people that will get seriously affected is the futures traders, i don’t think any DEX will offer the much leverage that the CEX will offer, and as such will discourage many traders but as said the normal P2P or trade to fiat will not be an issue

That would be a good thing in general. It might be a big problem at the start, but in the long run it would be beneficial. There'd be no more data leaks, questionable hacks, rug pulls, exit scams, bankruptcy, locked funds, ridiculous KYC, and so on and so forth. That would mean Bitcoin owners will be into self-custody rather than trusting third parties for their money.

Although this is far from happening, if this happens, developers would certainly come up with decentralized alternatives, platforms which can't be banned.

But honestly, I don't think the government will ban all centralized exchanges because they are relying on them to control and spy on us. As I said, it is only the Nigerian government, there is no second country that legalizes cryptocurrencies but wants to ban centralized exchanges. Many governments are starting to issue cryptocurrency regulations, and they require exchanges that want to continue operating in their countries to comply with the regulations and cooperate with them. In the future, many governments will even offer their own cryptocurrency exchanges through banks if the demand for it becomes more widespread and it will be easier for them to tax us. And I believe that the Nigerian government will soon reach an agreement with binance or other exchanges because they will not want to lose the huge tax revenue from there.

The government are not really against centralized exchanges, they can get any information they want from them and they can use them to confiscate people's money, they'll only have issues with them if they are non-compliant, especially with kyc requirements. It is not possible for most countries to ban centralized exchanges, what they are against is privacy solutions, they enjoy centralization. However, if we agree that this can happen, then if you've not been trading p2p, you'll have to start doing it.

Well, Bitcoin has had a lot of traction since its existence, and it has become so popular that it cannot be stopped by any factor except a global pandemic, and perhaps all the centralized exchanges cannot be banned to affect Bitcoin. There are a lot of centralized exchanges in the crypto world, and they can be used in the majority of countries where Bitcoin is not banned. There are also some decentralized exchanges for Bitcoin, and you can also trade Bitcoin via direct human-to-human p2p trading.

The only way to regulate cryptocurrency is through centralized exchange. It’s very dumb for the government to completely banned it since Bitcoin is decentralized and can’t be regulated on its own.

There’s also P2P and DEX exchange which can offer trading without relying through the centralized exchange. Bitcoin will continue to be traded as long as there’s a demand since it’s main use is for Peer to Peer transaction and not through 3rd party like Exchange. We are just no choice on using CEX since it offers instant liquidity to trade our asset immediately.

I believe that blaming centralized exchanges for attacks is often driven by a desire to share in their profits. Although it's uncomfortable to admit, all exchanges, to some extent, are involved in dubious money laundering activities. They make substantial profits from laundering and market manipulation, and as long as they pay their dues to regulators, they'll continue to operate without major issues. Decentralized exchanges have their own advantages, but they can't dominate the market because it's too large for them to handle alone.

We've already had a global pandemic. Bitcoin, not only continued working, but became stronger than ever, against all odds. And that's because in times like these, when faith in the government starts to decline, it makes sense to become interested in Bitcoin.

So, the only way to regulate cryptocurrency is by banning the entities which are not supposed to exist in the first place. Such sense, wow!  :D

Most of the countries that blame crypto for anything in their economy have a very poor economy. They certainly do not have significant influence on a global level, so shutting down crypto is a decision that will only harm them.

They have to change the government that governs their country and choose one that is more modern and more open-minded

It is really strange to blame cryptocurrencies and make them the primary cause of this country’s economic problems. Crypto contributes to financial inclusion, provides increased access, decentralization, and privacy, improves the efficiency and costs of transactions, and is an alternative solution to traditional financial systems. The economic problems that this country suffers from are the result of other causes, and cryptocurrencies have nothing to do with them. Many countries have legalized crypto, and their economies have only been positively affected.

I do not think countries can ban CEX because it is already compatible with the regulatory and legal regulations in these countries, operates its services legally, and does not conflict with AML or KYC policies. And if these platforms are licensed in the country, I don't think they can be banned. Even if we assume that this happens, Bitcoin and some altcoins appeared before the launch of these centralized platforms. Then, through P2P and decentralized platforms, things will be finer and better than CEX, which conflicts with the decentralization of cryptocurrencies.

I suppose you are referring to Nigeria, that's the only country I know that has all the pictures you painted above. Well, the Nigerian government acted immaturely and they've always been in the business of blaming everything possible for their woes, they like to shift the blame instead of finding the right and lasting solution.

With their illegal detention of the Binance executive, they've now dropped the charges against them due to the intervention of the US government because the detention is baseless and can only happen in Nigeria. For these, I don't see it as any basis to fear the clamp down on crypto exchanges.

As for the question, it is no threat if countries of the world ban CEX, people will of course turn to DEX. Also, there will be other means to transact in Bitcoin like in Telegram and on other social media. But one needs to be very careful in these extra arrangements.

some African countries where the dictatorship is being even more radical and which has been against bitcoin and exchanges. but fortunately in my country, despite being an African country, the government has encouraged people to buy cryptocurrencies on international exchanges, in my country cryptocurrencies are very welcome. With the advancement that cryptocurrencies are having in terms of use in the world, it is now unthinkable and impossible for governments, all of them, to ban cryptocurrencies, which can and is happening and that governments are demanding exchanges to charge kyc

nowadays, even to use an exchange listed on the best exchange, the person needs to go through a very complicated kyc: ID, proof of address, photo holding ID, face ID, and so many things that the person needs to do at the time of kyc that is tiring. but this clearly shows that exchanges are complying with government recommendations and that therefore exchanges will not be banned, they will operate for many long years, even in these few countries that have banned exchanges and bitcoin, they will eventually have to change their stance . because cryptocurrencies will not disappear, on the contrary, every year more cryptocurrencies are increasing