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~dwulf
When I first heard about this story, I was thinking squabbling billionaires with massive egos going for a bout. But when I saw my crypto holdings begin to lose their price point, I decided this was something I needed to research more. Affecting the bottom line and all.
CZ and Binance
I will say this, CZ is an original OG, In 2015, he sold his Shanghai apartment and used the funds to purchase Bitcoin. and started his journey.
Launching the cryptocurrency exchange in July 2017, Binance was able to raise $15 million in an initial coin offering, and trading began on the exchange eleven days later.
I don’t know him personally, but his play at business is masterful if not a tad ruthless. Built a system in 2 years from his Shanghai apartment, is more than most people do.
SBF and FTX
Sam Bankman Fried, what I know is only the colossal joke on Bankless, where Sam is trying to defend CBDCs. Now, caught with his pants down in political bed with financial regulators from the US, to promote FTX and to throw Binance under the bus. Locking up FTX from withdraws except for their primary investors of course who get first dibs to withdraw.
How Typical.
Another tale of centralized trust
As if any crypto holder needs to be reminded do not leave your crypto on any centralized exchange. Not your keys, not your coins. For the life of me I cannot comprehend why, at this stage people are not more adamant to self custody their crypto and use the true old school (non centralized, no KYC) DeFi methodologies to trade.
The fallout from this is hitting everybody even OG crypto users as the price of BTC, ETH, and all the rest of the alt-coins are taking a dive.
No Half Measures for DeFi
Regulators do not offer any clarity, centralized authorities have unilateral control of your crypto on their exchanges (they hold the keys, not you). CeFi is said good for mass adoption, but the mass that are adopted do not get the whole picture and often get locked out of their accounts.
Instead they get a facsimile of the real thing. CBDC is what they want to sell the users promising protection from the failed CeFi. But that is worse, CeFi had fiat off and on ramps, and originally had mechanisms to off load into a safe cold wallet under the user’s control.
Of course, the user of the CeFi always had to bear in mind they do not have their own keys on the CeFi platform, so the CeFi, not the account user, always holds the kill switch. A CBDC “Half Measure” is no different and even worse than conventional CeFi.
Are there any good CeFi options?
In a word no, some may be trusted (there’s that word again), more than others. I think it goes without saying that Mt Gox, and FTX with BlockFi, would be a definitive hard pass. Even the reputable CeFi, like Coinbase, and Celcius would be a strict neutral selection, they still hold your private keys on their platform and still require KYC.
Kucoin, Binance, maybe Kraken? For me falls marginally positive, even though they still hold your private keys and in most cases require KYC or trade thresholds that induce KYC.
Ideally, and in all cases a savvy user should shift to DeFi mechanisms to clone CeFi equivalent trades. While it is true the CeFi training wheels will help mass adoption, eventually that mass adoption must evolve enough to be free of the training wheels, so they can have the flexibility and maneuverability to compete on a global scale.
Conclusion; Aftermath and Fallout
There is no doubt that FTX collateral damage is going to cascade throughout crypto and to other chains. BlockFi, for example is freezing its crypto credit card services and accounts. BlockFi is not FTX, but obviously has ties in the form of capital, which is effecting the BlockFi chain.
Even in the Polkadot ecosystem, Alameda Research was involved with Parallel, with a 2% stake in its operations, not enough to mortally wound it, but enough to sting.
All this in a bear market, making it even worse price wise, but prices aren’t our main focus, utility is.
Got to HODL, and eek out the rewards on DeFi exclusive platforms, the only system being able not to fall victim, of the CeFi.
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