Exchanges are privileged to recieve more than what they can hold or what they should be trusted to hold. They are used for what they are and even more than. That extra stretch causes the major helm
Failed centralized exchanges are of all kinds and sizes. They didn't die because they were trusted with so much. They simply failed; security failures, financial management failures, whatever.
That's correct! You have clarified the issues and yet we are pointing same direction although with different methods of explanation. When you look at the two possible reasons exchanges fail that you listed above, you will still understand that it's related to we trusting them more than they should be trusted, otherwise giving them more than they can safeguard.
This is also correct. But since we are able to identify the causes of repeated failure every time, isn't it possible to address those reasons and establish a clear contract that all trading platforms are required to follow and that is stipulated in the activity license? Of course, this can only be done by another central authority that is more powerful and influential than any size that any platform can start or reach one day.
Perhaps, at this stage in our history, we are not ready enough to completely abandon centralized platforms, given that we have what can be compensated for by decentralized platforms or peer-to-peer platforms.
Personally, I never encourage the use of centralized platforms, even licensed ones, since I care about my privacy. But this cannot be an objective treatment of the issue as a whole.
Yes, the central platforms prove their failure, regardless of their size and whatever their reputation. But let's be fair, our overconfidence in these platforms is not the only thing that makes them fail and drown us with them; The absence of oversight may also be one of the most important factors motivating these platforms to act recklessly with user deposits and data, and it may work if their activity becomes subject to more stringent control. Because it simply cannot prevent anyone from launching a platform, and at the same time it cannot prevent all users from trusting those platforms, whether knowingly or unknowingly.
Governments can play an amending role, but at that time we must also think about the means that enable us to impose control on the governments themselves so that they do not transgress, as is the case today with banks.
