Is there a mistake in my thoughts?
They can create assets internally in their exchange and allow trading on them, but even if people did trade those coins(bitcoins or altcoins), they wouldn't be able to withdraw those coins since exchanges cannot create coins in their real wallet out of the thin air, making those who traded it unable to withdraw those coins(since it doesn't exist in the blockchain). For this reason centralized exchanges might want to avoid doing it.
What do you think, is it possible or not?
It is possible but those exchange that will attempt to do it will have the intent to scam people for real.