I had to write this short article, because something’s been bugging me for a long time…
When you hold cryptos on an exchange, you hold nothing but a worthless IOU. That’s right… you don’t hold the real crypto, just a promise from the exchange that they’ll send you some crypto if you ever wish to withdraw it.
As we know, holding the private keys to your cryptos is the only true form of ownership. If you don’t hold the private keys in a hardware or software wallet, you are entrusting your crypto to whoever does.
So when you have crypto on an exchange, who holds the private keys? Not you. Maybe not even the exchange… because just like our Fiat-based system, the exchanges have created many more derivative-based cryptos than actually physical exist in the real world.
If every trader took physical delivery of crypto, in other words there was a run on the exchange, there wouldn’t be enough to pay out.
But hold on a moment, isn’t that exactly how the Fiat-based markets work? Err… yes, exactly.
The powers that be have implemented their manipulated trading market game for the crypto markets, hence we see crypto futures, Exchange Traded Funds, all manner of leveraged products and the same games and price manipulation patterns that occur in Fiat can be seen on a crypto chart too.
Meet the new boss, same as the old boss
The problems that cryptos set out to solve have ended up being sabotaged by the same cabal responsible for the current mess.
Cryptos were meant to eliminate the banks, cut out the middle men and free us from the current debt based, criminal 
financial system. They certainly weren’t designed to be linked to an imaginary market where the volume of derivatives traded every day is many times the magnitude of actual physical assets. That is exactly what the current Fiat system does and why it is in so much trouble.
When/if we do have a financial market reset, it will take the Crypto derivatives market with it… Period.
So when the market goes down, you better make sure you’re holding PHYSICAL crypto in a hardware wallet and not worthless derivatives such as Futures or ETFs. It only takes one exchange to go down and you can kiss your cryptos goodbye forever!
So very true. Wait for the next step, banks will soon offer custody holding of digital assets IMO. I’ve been saying for a while the before this is taken mainstream, that the space needs to be easier and more convenient. This will be one way that will happen. Mark my words. Thanks for the article.
That’s how the banks will sell it to us… an “easy and convenient” way to look after our money.