The irony of trading cryptocurrencies on centralised exchanges
In the top ten topics on steemit #bitcoin and #cryptocurrency are the two topics. There is enough noise about distributed applications and ledgers across the world today and rightly so. This noise, news coverage and adoption of cryptocurrencies all these will be possible only when there are enough exchanges of these bitcoins/altcoins are happening. Only when there are exchanges happening will you be able to find out the true value of something and hence Exchanges are very important.
Why is 'an exchange' or 'a transaction' important?
Let us just assume that all the bitcoin owners go HODL and just doesn't want to part with their bitcoins. Though this is highly improbable, just imagine situation for a second. Then there is now way for you to find out what will be the price of the bitcoin. It could 3000 USD, 50000 USD to or any big number for that matter. Similarly if nobody is ready to buy bitcoins you cannot determine what would be rock bottom. It could go down to 100USD or 100 USD or 0 USD. There is just no way identify that value until an exchange happens.
All the recent boom that we see in cryptocurrencies is because of the increase in their adoption. So the increase in value of these cryptocurrencies can be attributed to increased faith of people dYXZ (Representing dApps, dEx etc). But where are all these cryptocurrency investors exchanging their cryptocurrencies? In Centrialized exchanges like PoloniEx, Bittrex and the likes. Do you see the irony?
We are rallying bitcoin and altcoin because we believe in a distributed world but we are making the centralised exchanges rich everytime we make a trade.
I can imagine two owners of centralised exchanges meeting over a coffee and having a final laugh discussing the above.
If you want to know the details of the fees we pay to these Centralised exchanges take a look at my post