How Decentralized Exchanges Make Bitcoin More Resilient (and Us More Free)

[krishnapramod]

It appears that governments love blockchain technology but hate Bitcoin itself, as well as other “crypto-anarchic” digital currencies. Some governments are reacting in a panic because they are starting to realize that they can’t stop Bitcoin from becoming an alternative to their monopoly on currency, both as a means of exchange and a store of value. Centralized cryptocurrency exchanges are especially vulnerable, and other governments could follow China.

Atomic swaps are the first sign in a new wave of decentralization. It is going to be interesting to see how the trend develops, since for larger and more complex transactions with fiat currencies, LocalBitcoins and established exchanges are still the place to be.

“The panic has to set in at some point,” argued Beams. “But it will do so at different times for different governments, and will produce a range of responses from them when it does.

Beams suggested that the only way to really stop decentralized crypto-fiat exchanges would be to outlaw Bitcoin trading altogether.

However, he thinks that this sort of heavy-handed attack seems unlikely to be attempted in the U.S. or Europe because there are just too many vested interests in Bitcoin now. It’s more likely that the authorities will continue to insist on KYC, tolerate compliant centralized exchanges and demonize the decentralized ones.

“With all that having been said, I’m actually optimistic,” concluded Beams. “Attacks by state actors — real and threatened — are making every part of this ecosystem stronger. Bitcoin has proven itself anti-fragile as hell thus far, and by the time all the battles have been waged, what will emerge on the other side are alternatives to existing financial institutions — money, banks, exchanges and all the rest — that are actually better in every way than their traditional counterparts.

https://bitcoinmagazine.com/articles/how-decentralized-exchanges-make-bitcoin-more-resilient-and-us-more-free/

[HashFace]

I think you nailed it.  I was just thinking about this today, and exchanges operating as local and regulated business makes the most sense ... but if governments are really going to try to stop bitcoin, they are the weakest link.  DAOs may be the way of the future, especially in the countries already becoming hostile to cryptos.

[pooya87]

things like Atomic Swaps and decentralized exchanges are good for exchanging cryptocurrency with cryptocurrency. and that has a little market not that big.
most people are trading and a lot of them are trading with fiat versus bitcoin. that means Atomic Swap is meaningless, exchange is not really what they want either. they want more options and flexibility that the "centralized exchanges" are offering them for their trading. that is why to this day decentralized exchanges have not gained much popularity.

[maxblack]

Other than waves, which other can make custom tokens which can allow me to launch my own cryptocurrencies?

[jseverson]

It does make Bitcoin more resilient, but not invulnerable. A total outlaw of Bitcoin trading is bound to make waves in the market, regardless of the method and capability of implementation. I imagine the majority would rather not take action that could possibly be held against them in the future. You can never be truly anonymous on the Internet, so you can never be completely safe. I don't think Bitcoin can be killed completely at this point, but a ban would stifle demand, and consequently, ruin value.

Thankfully, as the article graciously stated, it does seem unlikely, if not outright impossible for countries like the US to impose such a drastic step.

[centralbanksequalsbombs]

Wow, once atomic swaps are popularized and a staple for most altcoins, this will strengthen the already strong decentralization of Bitcoin.

[centralbanksequalsbombs]

It appears that governments love blockchain technology but hate Bitcoin itself, as well as other “crypto-anarchic” digital currencies. Some governments are reacting in a panic because they are starting to realize that they can’t stop Bitcoin from becoming an alternative to their monopoly on currency, both as a means of exchange and a store of value. Centralized cryptocurrency exchanges are especially vulnerable, and other governments could follow China.

Atomic swaps are the first sign in a new wave of decentralization. It is going to be interesting to see how the trend develops, since for larger and more complex transactions with fiat currencies, LocalBitcoins and established exchanges are still the place to be.

“The panic has to set in at some point,” argued Beams. “But it will do so at different times for different governments, and will produce a range of responses from them when it does.

Beams suggested that the only way to really stop decentralized crypto-fiat exchanges would be to outlaw Bitcoin trading altogether.

However, he thinks that this sort of heavy-handed attack seems unlikely to be attempted in the U.S. or Europe because there are just too many vested interests in Bitcoin now. It’s more likely that the authorities will continue to insist on KYC, tolerate compliant centralized exchanges and demonize the decentralized ones.

“With all that having been said, I’m actually optimistic,” concluded Beams. “Attacks by state actors — real and threatened — are making every part of this ecosystem stronger. Bitcoin has proven itself anti-fragile as hell thus far, and by the time all the battles have been waged, what will emerge on the other side are alternatives to existing financial institutions — money, banks, exchanges and all the rest — that are actually better in every way than their traditional counterparts.

https://bitcoinmagazine.com/articles/how-decentralized-exchanges-make-bitcoin-more-resilient-and-us-more-free/

The thing is, once you separate Bitcoin from Blockchain, then you are left with either a private database or an unsecure database.

There are thousands of cryptos and maybe less than a couple of secure decentralized blockchains out there.

All else;
BLOCKCHAINS without bitcoin = another unsecure or private database which any small business (even coffeeshops) have which carry little value
BITCOIN BLOCKCHAIN = IMMUTABLE OPEN-SOURCE DECENTRALIZED GLOBALLY DISTRIBUTED VALUABLE SECURE (scarce supply of bitcoin)

Banks, shills, conartists are the backers of "Blockchain" without bitcoin.

Bitcoin became unstoppable since 2013. Bitcoin is growing immensely despite all big banks in every country starting a war 4-years ago on bitcoin in 2013 (all supervisors and tellers have been told to reject transactions relating to bitcoin if they are told about it but the easy way around this for everyone in the world was simply keep quiet and buy/sell transactions but never say "bitcoin".)

Amazing to see global trade growth on localbitcoins as well (scroll down to see all the individual countries:
https://coin.dance/volume/localbitcoins

[squatz1]

The biggest problem that I see with decentralized exchanges is that they're usually a bit more of a nuiscance to the people using them, and sadly, people would rather not go through trouble and go through more risk on these centralized exchanges to be able to avoid this nuisance. It's possible, that people could just be buying Bitcoin from other people instead of Coinbase, or trading altcoins peer to peer on decentralized exchanges rather then on Poloniex or whoever is winning that exchange battle right now.

Sad, but this is the world we live in. People would rather give up security for convenience.

[centralbanksequalsbombs]

The biggest problem that I see with decentralized exchanges is that they're usually a bit more of a nuiscance to the people using them, and sadly, people would rather not go through trouble and go through more risk on these centralized exchanges to be able to avoid this nuisance. It's possible, that people could just be buying Bitcoin from other people instead of Coinbase, or trading altcoins peer to peer on decentralized exchanges rather then on Poloniex or whoever is winning that exchange battle right now.

Sad, but this is the world we live in. People would rather give up security for convenience.

Very interesting, you may have a point?  But what if a decentralized platform was made convenient?

[UsernameBitcoin]

I think a great example for an exchange is BTC-e. I mean even after getting shut down they came back and are still going. Props to them.

[centralbanksequalsbombs]

I think a great example for an exchange is BTC-e. I mean even after getting shut down they came back and are still going. Props to them.

Yah, so what are the details of BTC-e coming back online? HOw much trust can be put on it? Can anyone help elaborate details for this?

In hte meantime, I'm really looking forward to be exchange-less with cross-chain atomic swaps!

[centralbanksequalsbombs]

I think a great example for an exchange is BTC-e. I mean even after getting shut down they came back and are still going. Props to them.

Yah, so what are the details of BTC-e coming back online? HOw much trust can be put on it? Can anyone help elaborate details for this?

In hte meantime, I'm really looking forward to be exchange-less with cross-chain atomic swaps!

bump. anyone?