The centralized exchanges are not the best or most transparent side of crypto or we can list lots of risks that the centralized exchange services have.
When we put the threats aside, they own some benefits which can help less - popular crypto projects to reach their target group of people. In the case that the native tokens of the projects are delisted from almost all of the top - tier centralized exchanges, they lose the hopes for the bull market times when the new All Time High prices become quite normal.
If the “Cexless” coins cannot attract new buyers, motivate the holders, yield returns, or own new use cases, the inevitable collapse has to happen when the music stops and the party is over. So, no matter how terrible the services of CEXes are, they are the markets where new people with dollars come to see what you offer them.
Considering the fact that the blockchain products and DeFi have gotten more complex and the newcomers are people with limited technological and financial literacy, turning back to the potential of Cexes does not sound like a strategically reasonable choice.
Each Cex listing creates natural buy pressure on the coin because the exchanges have to offer the coins / tokens traded on their platform. The trading pairs, leverage options, and market maker operations boost the volume as well as the price of the assets.
Lastly, different sets of regulations are coming all around the world. At the same time, some exchanges are forced to restrict the access of the X citizens to the global markets, and the local and regulated ones are supported in their actions. So, the more diversified centralized exchange listings a coin has, the better for its future performance and growth in the ecosystem.
Nextrope Comparison of CEX vs DEX
Crypto is joining the Champions League. Though the growth potential is higher in this level, the risks cannot be neglected. It took years of downtrend to go over the wounds of FTX and the cexes do not accept any responsibilities in case your funds are at risk.
It might be a better idea to hedge the risks of cexes by refraining from the potential dangers to your money and we can use the platforms accordingly. Ignoring yields only worse results in the long run. This bull market might be the last partially regulated time of crypto. No one knows what will happen to the decentralized finance and the operations on them. As the centralized exchanges still have some benefits for promising projects, let's just enjoy the current state and try to maximize the return for our ecosystem.
The stereotype that CEX is bad has to be over. Like everything in our lives, there are pros and cons depending on your preferences and actions. As long as the benefits outweigh the risks, we may try to go for it cautiously.
What do you think about the contributions of centralized exchanges?
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