Binance is a good example of this. People are clamoring that they can’t cash out their chips, being told to look for P2P in order to cash out. Just like a pyramid scheme. There needs to be more protection for investors. It makes me worry for the future of existing exchanges.
Here’s a long morning rant
Just as Charlie munger said about Robinhood...it terrible to lure people in with the so call free commissions trading And from the look of Reddit’s Wall Street bets raise it’s actually bad news for traders the free advertising ( good or bad it’s still publicity eg kardashian effect ) will lure more fishes into the pool . There are markets maker whales that will wait for the right time to gobble them up.
Binance it’s boarderline mtgox , a bad political situation can cause some exchange to collapse eg turkey . As many of these are build on unstable foundation. in China look what happen to jack ma and ant and a few other tech .
A shakedown of crypto will start at the top exchanges or the bubble pop and it will cause a big domino . crypto are like daytraders wet dream. Heavy leverage weak hands will lead some panic selling and margins calls .
As for the weak hands Lot of crypto millionaire didn’t have to do much to obtain it , although some with little work, luck ,hacking or illegal means. So they will treat it as such easy come easy go ( like a gambler mentality of justifying a $1000 lost with initial capital of $10 that build up to $1000 ) these folk will swing for the fence and get rich or loose it all trying, almost all will loose it all .( a side thought that most of those reddit WSB folks are gamblers and some got their money thru bitcoin and crypto)
