With the birth of Bitcoin, the cryptocurrency exchange has become the top resource in the cryptocurrency industry. From the earliest Mt. Gox to today's Binance, Coinbase, OKEx, Bittrex, etc., mainstream exchanges have so far carried 90% of the volume of the cryptocurrency industry. Some people say that the exchange industry has basically entered a bottleneck period, it is difficult to have a big deal, and some people think that the current exchange is completely unable to cover the surge in the volume of future digital currencies. From the bear market in 2018 to the present, 70% of the small exchanges have disappeared forever in the eyes of the people, and 20% of the exchanges are at a loss, can not find the future direction of development and their own positioning, their own In the process of gradual demise. However, in my opinion, the second half of the cryptocurrency exchange has begun to brew in this bear market.
Concisely summarizing the further competition of the digital currency exchange will be: Data Transparency and Auditability, As the top resource of the industry, leads to the role of the changer in the cryptocurrency industry.
Data transparency based on an independent audit
From Twitter to Telegram, almost every social media has negative news about centralized cryptocurrency exchanges every day, from manipulating currency prices to hacking attacks, and the core of these problems stems from data opacity. It's hard to imagine how ironic it is to complete a transaction in a digital asset with a non-tamperable blockchain technology at the center of a completely opaque central exchange.
The main competitive content of the centralized exchange business will start with data transparency in the future. Data transparency will be issued by an independent third-party auditing company with the principle of independent auditing fairness and disclosure, which will greatly increase the credibility of the business of the exchange.
The centralized exchange will hybrid with decentralized exchanges to mix and store the ledger in a separate blockchain, to solve the bottlenecks of concurrency in the decentralized exchanges, and to ensure the independent auditing ability of the books to achieve maximum data transparency.
As a cryptocurrency industry compliance promoter
Cryptocurrency exchanges provide digital assets to individual customers and institutions for transactions, and their responsibilities include promoting compliance with digital asset transactions. When there is no more reasonable compliance method in countries to supervise the digital currency trading platform, the digital currency trading platform has a deep understanding of the industry, and at the same time, it is also clear that in compliance, what is required for compliance, and can relevant policymakers work together to match compliance assets and transactions, driving the development of the entire digital currency industry.
Leading compliant capital into the cryptocurrency market
Just as ETF applications receive widespread attention in the industry, exchange-compliant business flows will lead large-scale compliance capitals into the cryptocurrency market. Through compliance, cryptocurrency becomes a risk hedging asset equal to financial derivatives such as stocks and futures, which makes the financial attributes of digital assets gradually play a role in traditional finance, and thus qualitatively changes the existing financial model.
Accelerate the construction of payment channels as the main body of crypto asset aggregation
As the largest aggregate of digital assets, the cryptocurrency exchange is more competitive in the payment field than a single cryptocurrency that plays P2P role independently. Through the aggregation of digital assets, digital payments will be gradually extended into daily life to achieve the real financial application of digital assets.
In the second half of the digital currency exchange competition, regardless of compliance or non-compliant exchanges, if breakthroughs are made in the above different fields, it will lead the entire cryptocurrency era, instead of today’s simple figures, cryptocurrency is used as a simple speculative tool like stocks.
Perhaps after seeing the descriptions above, many Geeks will immediately ask: Is this not completely lost the meaning of decentralized ledgers? Is it completely contrary to the decentralization represented by the blockchain? As my personal understanding, any new thing needs to invade the traditional model and gradually replace the traditional business model when it replaces the old model. This may take 10 years. So let's complete the first step – intrusion into the traditional financial business from the cryptocurrency exchange business first!
If you are interested in my idea, please feel free contact with me. I'm happy to work with investors and technicians to bring next level cryptocurrency exchange.