Centralised Exchanges are the Biggest Enemies of Bitcoin

[Thomas Edward Lawrence]

The ideology behind crypto is freedom and liberty from the current government system(s) that are inherently wrong and elitist.

HOWEVER

Centralised exchanges such as Coinbase, Kraken and Binance take a noble idea of bringing Bitcoin to the masses and mock it by affiliating with governments (and governmental agencies) that the very concept of Bitcoin is designed to rebel against.

Big CEXs are killing the original bitcoin spirit by forcing users to pay tax on gains, freezing user's assets, preventing users from using their service depending on their IP and more.

This is horrible. This is not what bitcoin is. This is not freedom. This is not liberty.

Taxes contribute to the regimes that so many of us are against. How can we continue using companies whose values don't align with ours?

Taxes are theft and fund wars and needless bloodshed in countries such as Iraq, Afghanistan and more.

The solution is pretty clear: More projects need to be released that are focused on building sustainable decentralised solutions to enable users to trade and purchase bitcoin (and crypto in general). Right now the main areas of focus need to be security and simple UI/UX interfaces.

And we need to stop using CEX and funding what we are all against.

[romero121]

I never find centralized exchanges a threat to bitcoin. Only through these exchanges the bitcoin market have grown to this level. I don't say decentralised exchanges are bad, but coinbase, kraiken, Binance and other centralized platforms gave the users the ease of access and trust. The freedom and being anonymous makes people prefer DEX. With Dex the fees were low compared to the centralized exchanges. Moreover such a massive usage of bitcoin and other cryptocurrencies could've never happened if these exchanges haven't existed.

On the other hand there is flaw with these centralized platforms. These platforms having the complete control over our funds is like having our funds in our banks. So, it is upto the users choice to pick the one that fulfill their need.

[mk4]

We're simply not ready to stop using CEXs yet, as obviously bitcoin isn't adopted enough to be able to buy and sell(or convert) it easily to almost anyone. What we need right now to progress are non-custodial peer-to-peer exchanges with good UX.

[davis196]

Centralized cryptocurreny exchanges have one big advantage-they are user friendly.
Their biggest disadvantage is that you don't have full control over your coins.
You have to understand the centralized exchanges are simply companies,who are complying with the rules,which were imposed by the governments,like KYC or paying taxes over crypto earnings.
CEX have helped a lot for Bitcoin/crypto adoption,so I can't say that they are biggest enemy of Bitcoin/crypto.
The biggest enemies of BTC/crypto are the FUDsters and BTC/crypto haters.
Most of the governments are neutral towards crypto.

[Anonylz]

The only downside of Centralized exchange is being Centralized   which is equal to having control over users. Cex has a huge number of users who don't seem to mind the downside provided they are able to buy and sell btc, they serve as an avenue to access btc quickly and easily compare to dex, some people don't find using dex easy, and I don't know much about btc ATM, how accessible and easy to use they are.
Centralized exchange in a way makes buying and selling Bitcoin less stressful with a price (control) which to me don't seem to be a threat.

[Bttzed03]

~ The solution is pretty clear: More projects need to be released that are focused on building sustainable decentralised solutions to enable users to trade and purchase bitcoin (and crypto in general). Right now the main areas of focus need to be security and simple UI/UX interfaces.

Well, it's not that decentralized exchange doesn't exist. Bisq has been operating for a long time but its trading volume is way too low compared to CEX and other less decentralized exchanges. You should probably blame the people who prefer to use Binance or Coinbase. It's the reason why these exchanges are thriving.

[Maestro75]

Centralised exchanges are not criminal enterprise and bitcoin haters. Consider how far it has brought bitcoin awareness and transactions to the people. Consider how easy it is now to transact bitcoin and other cryptos and what it was 10 years ago. How many decentralised exchanges are even here now to start with, talkless of how it was a decade ago. We should learn to appreciate things step by step. The only problem I see with centralised exchanges is just that they keep customers funds and can deny them access because of one thing or the other. Minus that, centralised exchanges have done more good than bad for cryptocurrency.

[Accardo]

CEX are like other centralized payment platforms such as Paypal. They can freeze an account any moment and control the affairs of their platform. Most people who make use of CEX should have leant their lessons regarding the recent ban on suspicious accounts; that keeping money on CEX is risky. Knowing that the key is not yours why not trade and withdraw some amount and leave spare funds for trading in the future. A lot of traders or users of bitcoin are using Exchanges as wallet and its not recommended.

[KaliLinux]

Ahhh, don't overthink it. Even though I understand what you are saying but I don't think CEXs are such an enemy as you say. How many DEXs were there when Crypto/Bitcoin started? I agree as others have pointed that CEX have their downsides however everyone in the system doesn't feel the same with some of these issues and don't have any problem with KYC and even taxes as long as they can trade their crypto assets.

[Upgrade00]

Bitcoin was created to be a free network which can operate without the need for a third party, but so many people who hold bitcoin are not doing so because of the freedom or ease of access it offers, but rather because of the speculative value, and these people do not mind giving up their privacy and freedom for the ease that CEXes supposedly offers

And we need to stop using CEX and funding what we are all against.

This would not be happening anytime soon, you can even judge through the comments here on bitcointalk that majority of people are not ready to accept that centralized exchanges are an antithesis to what bitcoin was designed to be.

[pooya87]

The ideology behind crypto is freedom and liberty from the current government system(s) that are inherently wrong and elitist.

That is partly the ideology of bitcoin not the whole cryptocurrency scene. In fact the main ideology of majority of altcoins is to be traded for profit and nothing else.

Centralised exchanges such as Coinbase, Kraken and Binance take a noble idea of bringing Bitcoin to the masses and mock it by affiliating with governments (and governmental agencies) that the very concept of Bitcoin is designed to rebel against.

Well, there is no restriction on who can use bitcoin. It is free for some people to create some centralized service and use bitcoin in that world. They aren't threatening bitcoin or its ideology, they are just using it the way they like and nobody can prevent it.

Big CEXs are killing the original bitcoin spirit by forcing users to pay tax on gains, freezing user's assets, preventing users from using their service depending on their IP and more.

I disagree. As I said above, it is free to use by anyone for any purpose and whatever they use it for is not changing anything. For example for the past 4 years there have been people who insist that bitcoin is only a store of value and not a currency. If that's what they want to think, it's fine but it won't change anything about bitcoin.

Taxes contribute to the regimes that so many of us are against. How can we continue using companies whose values don't align with ours?
Taxes are theft and fund wars and needless bloodshed in countries such as Iraq, Afghanistan and more.

It seems like the problem you have in mind lies elsewhere considering that the revenue government makes from cryptocurrency tax is negligible compared to literary taxes on anything else.

The solution is pretty clear: More projects need to be released that are focused on building sustainable decentralised solutions to enable users to trade and purchase bitcoin (and crypto in general). Right now the main areas of focus need to be security and simple UI/UX interfaces.

And we need to stop using CEX and funding what we are all against.

This I can agree with. We already have decent solutions like Bisq, what we need is more people to use them so that their volume increases and any possible bugs are found and any feature they have be improved.

[mindrust]

That's true but there is another aspect to this problem which is the current FIAT monetary system.

The real problem is, you can't really spend your crypto without converting them to FIAT first and when FIAT is in the picture, it is impossible to make it work in a decentralized way. You send crypto, you get FIAT. Some middle-man will have to take your crypto and give you FIAT. I know the decentralized exchange Bisq claims to do it but I am not sure how that works. If that was working properly everybody would use it but as you now it is not the hottest shit around.

[franky1]

The ideology behind crypto is freedom and liberty from the current government system(s) that are inherently wrong and elitist.

HOWEVER

Centralised exchanges such as Coinbase, Kraken and Binance take a noble idea of bringing Bitcoin to the masses and mock it by affiliating with governments (and governmental agencies) that the very concept of Bitcoin is designed to rebel against.

Big CEXs are killing the original bitcoin spirit by forcing users to pay tax on gains, freezing user's assets, preventing users from using their service depending on their IP and more.

This is horrible. This is not what bitcoin is. This is not freedom. This is not liberty.

Taxes contribute to the regimes that so many of us are against. How can we continue using companies whose values don't align with ours?

if you want to use a business that is involved in money services (exchanging bitcoin for fiat) then you have to accept that the need of the FIAT part then becomes a need to obide by fiat laws.
just because one side of a buy-sell is bitcoin. does not 100% absolves a trade from fiat laws.. because the other side of a buy-sell is fiat

this is not the fault of the business. its the fact that any business doing money services using fiat needs to abide by fiat laws
EG just because you want a banana. but want to trade fiat for a banana. does not automatically free a retailer of its fiat obligations of sales tax purely because your personal interest is only banana's

the very fact that you want to involve a trade of a banana for fiat makes your real physical need of the swap, then forcing the service that provides that swap for you to abide by fiat laws. you WANT a banana but you NEED a service that swaps fiat for banana's. so retailers have to abide by fiat laws to satisfy your banana 'WANTS'

yes you can say 'but all i want is a banana' but reality is if your at a retailer trying to get a banana, you actually are part of the fiat-banana trade. so you actually need fiat aswell.

as for pretending 'de-fi' and 'd-ex' things will solve this.
well it wont last long.
any human/entity offering a service for swaps, and receives a fee for offering the service of swaps. needs to register as a money service business. if they dont and they are found. they can get highly punished

just trying to pretend your a Dex or a De-fi does not absolve you of a financial crime an authority defines.
your protection is not 100% that bitcoin is untraceable pseudonymous. because authorities can find you by tracing the fiat instead
(high amount of personal wire transfers to lots of different people each day.. its how they found the 'localbitcoin' traders)

bitcoin does not make fiat laws get repealed simply because 50% of a trade is bitcoin.. because the other 50% is still fiat. thus fiat laws still apply

[Magicalking]

The exchanges have to make money, it is a private business. The fees they charge do not bother me.  My problem with centralized is compulsory KYC for their customers. It is like relinquishing power to the corporations. If there was provision for an easier alternative for p2p services and trading crypto most will stop using centralized exchanges. I only deposit coins I want to immediately convert to fiat in CEXs.

[bussybuddy]

Satisfying an individual can be very easy, but with a large community, this can seem difficult. There are issues where we are not satisfied with the current CEX, but admittedly, it is still the place to go if people have access to more things. It is like an enemy of BTC as well as a friend to help BTC reach many people, I hope to find more than just complaints or praise.

[Jawhead999]

First you said Bitcoin is freedom, but the last line you forcing someone to stop using centralized exchanges? this is not 100% freedom. Let alone people to choose which exchanges they use, it's either centralized exchanges, custodial P2P exchanges, or fully decentralized exchanges. There must be a reason why they choose to using any exchanges and the most users prefer to using centralized exchanges. This means they don't care with their privacy concern and their funds partially got controlled by the exchanges.

[dbc23]

I never find centralized exchanges a threat to bitcoin. Only through these exchanges the bitcoin market have grown to this level. I don't say decentralised exchanges are bad, but coinbase, kraiken, Binance and other centralized platforms gave the users the ease of access and trust. The freedom and being anonymous makes people prefer DEX. With Dex the fees were low compared to the centralized exchanges. Moreover such a massive usage of bitcoin and other cryptocurrencies could've never happened if these exchanges haven't existed.

Centralized exchange might not literally mean to serve as threat to Bitcoin but they way they go about their p2p exchange and the unnecessary KYC verification stands as a big threat. Mostly when this centralized exchange go as far as freezing their customers wallet maybe due to incomplete KYC verification or massive funds

On the other hand there is flaw with these centralized platforms. These platforms having the complete control over our funds is like having our funds in our banks. So, it is upto the users choice to pick the one that fulfill their need.

This is where the frustration that accompanies this centralized exchange comes from. And most times users account could be freezed for a long time pending when a complete KYC verification Is done keeping the owner of the wallet at the mercy of this so called exchanges

[o_e_l_e_o]

How many DEXs were there when Crypto/Bitcoin started?

This is a false equivalence. Centralized exchanges 10 years ago were not anti-bitcoin like the centralized exchanges today are. They did not demand ridiculous amounts of KYC and even go as far as asking your to reveal your employment and income source. They did not arbitrarily lock accounts or seize coins. They did not hire blockchain analysis companies (or event create their own!) to spy on you and monitor your transactions. They did not discriminate against individuals based on the history of their coins, even though that history has nothing to do with the individual in question. They did not refuse to let you withdraw your coins, censor your transactions, report you to your government, sell your data, and so on. Centralized exchanges might help more people buy and sell bitcoin, and of course people are free to use them if they want to, but they are absolutely antithetical to many of the founding principles of bitcoin.

[Zilon]

First you said Bitcoin is freedom, but the last line you forcing someone to stop using centralized exchanges? this is not 100% freedom. Let alone people to choose which exchanges they use, it's either centralized exchanges, custodial P2P exchanges, or fully decentralized exchanges. There must be a reason why they choose to using any exchanges and the most users prefer to using centralized exchanges. This means they don't care with their privacy concern and their funds partially got controlled by the exchanges.

Which exchange to use is a clear choice from what I understand about @ op post. Bitcoin is total freedom only with DEX but centralized exchange is a big treat. It is alarming with the rate at which centralized exchange choke their clients with KYC that are irrelevant atimes. If it was limited to just email address and phone numbers it's would have been a bit fair but it goes all the way to getting identity cards and international passport

[franky1]

How many DEXs were there when Crypto/Bitcoin started?

This is a false equivalence. Centralized exchanges 10 years ago were not anti-bitcoin like the centralized exchanges today are. They did not demand ridiculous amounts of KYC and even go as far as asking your to reveal your employment and income source. They did not arbitrarily lock accounts or seize coins. They did not hire blockchain analysis companies (or event create their own!) to spy on you and monitor your transactions.

exchanges back then were unlicenced.
do you think they had the choice?
hmm..

the thing about exchanges are.. they involve EXCHANGING, meaning FIAT, meaning fiat laws apply
they did not decide one day 'lets spy' they were made to by having to become legitimate if they wanted to continue doing business
when bitcoin got treated as an asset instead of just a product they had to become legitimate money service business. meaning they had to get a MSB licence, or get shut down.
they could no longer get away with being merchants/'goods swappers' they were being treated as potentially illegal currency traders/money service businesses, unless they got licenced

the problem that made them have to go legit was that bitcoin got legitimately recognised as an asset instead of a good/product

you may not like the outcome of this. but atleast learn the how and why, and understand its not the exchanges fault.
the funny thing is that it has been weeks/months since the other draft bills have been doing the rounds on social media, and you still have not learned anything about brokers or MSB's or even regulations to understand the way things work in the real world

here is a hint.
the latest couple draft bill you have been mis-understanding.
the first you have been trying to manipulate into your warped vision.. brokers even in LN channel routes (businesses taking a fee for routing payments) and decentralised exchanges will have to get a MSB licence too.. and no dont you even dare show your idiot side by pretending it only affects developers and miners(reality: they are not brokers).. because showing that side just reveals how much you dont know about what a broker/MSB is,
the second you pretend that it gives strange powers that can be used at a whim without court orders or oversight. (reality is it took out the whimsy of using unapproved laws before said laws got ratified)

exchanges are not the enemies, because that then means that even LN route hubs offering payments for a fee are enemies too.. (oops did i poke your bears softspot) they just become the port border guards of all asset/currency jurisdiction, rather than just a port shipping company moving goods

please take some time to learn
and i suggest with your desires, hopes and DREAMS of your altnet loyalties. LEARN FAST because you will soon realise how your favoured services of your altnet will get affected by this. and no stop the fantasy of thinking it affects devs,miners and leaves your special channel services alone. learn its the opposite it leaves developers and miners alone and affects your special channel services