I recently asked my friends, and they think that wherever they are asked to undergo identity verification, there will be a guarantee that their funds will be safe. People know little about decentralized exchanges because the search first tells them to use what is fastest to find. Learning something deeper is usually very lazy for beginners. For some, Bitcoin is still associated with banks and the government being held accountable if they are hacked or funds are lost.
Yeah that's mostly the reason why some people prefer storing their assets in centralized exchanges, just as you said because they feel that with the need for verification and KYC that one is unlikely to get scammed and in a case of scam that the scammer can easily be identified or tracked since his personal information are in the exchange's database. Though this is not true as one's assets can still be vulnerable to hacks and may not be able to be traced.
Now that there are quite a few solutions for buying or staking cryptos, I was wondering what's the point of going through a CEX when you're not trading. I'm sure there are things I don't know, but I'd love to know all the things that are, perhaps, super interesting.
Not everyone uses exchanges as for airdrops or trading, some just find it convenient enough for them to use and as it doesn't employ the use of seed phrases, they feel they can recover their accounts whenever they forgets their password, and this is also one of the major reason why people use centralized exchanges because in decentralized exchanges, not your key not your coin so in a case where you have forgotten your seed phrases, your crypto may be gone forever.
