another reason why maybe we should not use indian cex as they're doing exactly what ftx did and got burnt
the news doesn't state which exchanges are doing this specifically but it does goes on to say that they suspect most of them r doing it
link to the article is here from toi:
https://timesofindia.indiatimes.com/city/hyderabad/i-t-probe-flags-crypto-exchanges-use-of-client-assets-without-profit-sharing/articleshow/123591354.cms?utm_source=chatgpt.comHyderabad: An income tax department investigation into cryptocurrency-linked tax evasion has found that Indian crypto exchanges are using client assets deposited with them for their own purposes, without sharing profits with investors.
Officials said most exchanges clearly state in their terms and conditions that tokens parked by users can be deployed at the exchange's discretion, including for lending or trading. The original holders retain only the right to sell their tokens.
To generate returns or boost liquidity, exchanges often lend crypto to other users or pool it for staking, but investors are not informed when their specific assets are being used.
Experts describe the practice—known as rehypothecation and commingling—as highly risky. They point to global examples such as the collapse of FTX, where client funds were diverted, leading to massive investor losses. Officials admit that such practices have been detected in India, but enforcement agencies are unable to act since no regulatory framework explicitly prohibits exchanges from handling assets in this manner.
i have never staked any coins before as mostly i just convert any crypto i receive to bitcoin and thankfully bitcoin doesn't have that mechanism
but how trustworthy r these staking services r? what if these exchanges who r staking people's money for what 10-12% a year lose it all
if the staking service they use decides to run away or get hacked?
btw, what happened to ftx is described here:
https://www.investopedia.com/what-went-wrong-with-ftx-6828447
