Bitcoin Forum
November 22, 2017, 03:09:32 PM *
News: Latest stable version of Bitcoin Core: 0.15.1  [Torrent].
   Home   Help Search Donate Login Register  
Pages: [1]
Author Topic: [2017-06-24]Changing Exchanges: Will the Coinbase of Tomorrow Be Decentralized?  (Read 2955 times)
Full Member
Offline Offline

Activity: 224

View Profile
June 24, 2017, 03:02:57 PM

Changing Exchanges: Will the Coinbase of Tomorrow Be Decentralized?

Newcomers to blockchain may notice the irony – in an industry obsessed with decentralization, some of the biggest startups are centralized, trusted institutions.

But while it's true today that single entities are most responsible for the operation of exchanges that allow traditional money to be traded for cryptocurrency, some of the industry's oldest startups are now showing an interest in migrating to a future more in line with the spirit of the technology.

Forcing this narrative is a new wave of decentralized cryptocurrency exchanges that exist almost entirely on a blockchain, and that can dispense with the need for a third-party intermediary.

"Decentralized exchanges are clearly the way of the future," said Hugh Madden, technical director for openANX, a decentralized exchange infrastructure protocol.

Madden argues that a change in industry business models is inevitable as current designs are a target for hackers, and indeed the still-brief history of cryptocurrencies already includes several examples, most famously, Mt Gox.

Furthermore, if a centralized exchange operates in a jurisdiction without strong regulatory oversight, the operational and financial transparency of the operation can be limited. And with many such exchanges, customer coins are not technically possessed by the customer until they are withdrawn.

With decentralized exchanges, each customer's buy and sell orders are directly matched, sometimes without an order book entirely.

Pages: [1]
Jump to:  

Sponsored by , a Bitcoin-accepting VPN.
Powered by MySQL Powered by PHP Powered by SMF 1.1.19 | SMF © 2006-2009, Simple Machines Valid XHTML 1.0! Valid CSS!