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Do We Really Need So Many Crypto Exchanges? Yes, and Here’s Why

Published 07/17/2019, 07:07 AM
Updated 07/17/2019, 08:21 AM
 Do We Really Need So Many Crypto Exchanges? Yes, and Here’s Why

Do We Really Need So Many Crypto Exchanges? Yes, and Here’s Why

Over the last couple of years, the crypto exchange market has exploded at a rate seemingly unrelated to the value of the cryptocurrency markets. At this time, CoinMarketCap alone lists over 250 different trading platforms; however, there are probably hundreds more. Although it’s difficult to get precise numbers about exchange launches, this year we’ve seen many more new exchanges come to the market, including the Binance DEX, DX.Exchange, and BQT.

So, Isn’t the Exchange Market Too Crowded?


A new crypto user would probably say yes. After all, with hundreds of exchanges to choose from, any newcomer being told to “do your own research” has their work cut out.

Each exchange offers a combination of coin pairings and trading fees, with different user interfaces, quality of customer service, and security considerations. Some allow fiat on-ramping, others don’t. This all comes before you consider additional offerings like exchange tokens, margin trading, or the whole centralized vs. decentralized debate.

However, for anyone who’s been around the cryptocurrency scene for a few years, there are reasons to welcome an influx of new exchanges. One critical point it solves is the distribution of funds across many smaller targets for hackers.

Back in 2014, crypto exchange behemoth Mt. Gox was handling around 70% of Bitcoin transactions worldwide. Hackers hit the exchange hard, lifting 850,000 BTC, worth around $450m at the time. The incident was catastrophic for the markets. Bitcoin lost more than half its market cap over just a few months.

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This article appeared first on Cryptovest

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