Friday, November 27, 2020

Investors are back into Bitcoin but DEXs are still the future of crypto

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Bitcoin’s long-waited bull run and the recent wave of corporate and institutional investors allocating significant portions of their reserves to Bitcoin (BTC) are all signs that the pace of crypto’s mainstreaming is rapidly accelerating: But has the path to mass adoption come at the cost of privacy and decentralization? 

Know Your Customer and Anti-Money Laundering laws have forced the majority of cryptocurrency exchanges to become more transparent about who their users are, and those who refused have had to limit the jurisdictions in which they can offer services.

In order to operate legally in many countries, many exchanges have had no choice other than to abide by strict AML procedures, and aside from Monero (XMR), swathes of privacy coins have been delisted from most major exchanges.

Recently, regulators have begun to crack the whip and jurisdictions around the world continue to propagate further measures to ensure investors disclose their crypto holdings and pay taxes on their profits.

And this is all happening as the United States Department of Justice arrested the co-founder of BitMEX and the CFTC charged its owners with running an illegal crypto derivatives exchange.

Roughly a week later, the Financial Conduct Authority, the United Kingdom’s top regulatory watchdog, went as far as to ban investors from derivatives trading at all crypto exchanges.

All of these maneuvers are designed to force compliance on crypto service providers, and while they may eventually assist with furthering mass adoption, many crypto ideologues are looking for alternatives to press their case for financial self-sovereignty.