this post was submitted on 14 Aug 2024
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I'm not saying it greenlights making it crypto, I'm pointing out that the system in place doesn't prevent scams anyway.
The advantage of the blockchain, even if it's centralized, would be the transparency. USDT is centralized, doesn't keep people from using it and it allows the central authority to freeze stolen/criminal assets if they need to, but it's stuff anyone can look into if they want.
I'm not saying decentralized cryptos are more likely to be scams, I'm saying open cryptos are more likely to be used for scams. There's no shitcoins used for pumps and dumps on the Bitcoin network because Bitcoin is the only thing being traded on it. The Ethereum, BNB and Polygon networks are open, anyone can create alternative coins on them in a couple of minutes, that's where the scams happen.
Oh, because they're open source and easy to fork. Following now.
The issue is that only decentralized cryptos are actually transparent, centralized ones are just "trust me bro." Look at FTX.
FTX was an exchange though, they didn't operate a network as far as I know. So on a centralized exchange itself there's no transparency because they take the coins, put them in their own wallet and trades happen internally, but in theory you can still see how much of each give the exchange has in its wallet as the wallet itself is public. There's decentralized exchanges as well that just facilitate the exchange of coins between people but it's all happening on the network.
The way I see it for a stock exchange you would want that second option (decentralized exchange so it's transparent) and the different stocks would be what are called alt coins on the existing networks, but only the central authority could create new ones instead of it being open bar...