CEO of Tesla, Elon Musk, has expressed his disapproval for the use of centralized exchanges, thus encouraging crypto users to ditch CEXs like Binance, Robinhood, Hotbit, OkeX etc. ayokinews.com reports
Musk made this known while commenting on a tweet, on Tuesday.
A Twitter account with the name ‘MyDoge CTO’ posted a controversial statement that played down the use of centralized exchanges like Binance and Robinhood. In his tweet, the user stated the vision of the MyDoge crypto project, a project that aims at providing a social wallet for crypto users that is not only simple to use but also decentralized.
According to his tweet, the vision is “to break the dependence on CEXs like Binance and Robinhood and let #shibes take custody of their coins!”
Commenting on the post, another Twitter user replied with the famous phrase; “not your keys, not your crypto”.
To the amazement of many, the tweet caught Elon Musk’s attention who replied affirmatively. Although the famous Dogecoin fan did not say much, but the word “Exactly” was enough to drive the point home.
“Not Your Keys, Not Your Crypto”
Although, many crypto users are aware of the setbacks of using centralized exchanges, but CEXs have continued to grow massively over the years. Unlike a decentralized platform where users own the private keys to their wallets, users of centralized exchanges do not have access to private keys. This implies that the assets of individuals who use CEXs are not 100% safe.
The Red Flags of Centralized Exchanges:
In the past, CEXs like Huobi and Hotbit have been victims of Cyber-hacks, leading to loss of funds, either partially or totally.
Centralized exchanges also place withdrawal restrictions that may be unfavorable for users. Perhaps, a more concerning fact are the scandals which several centralized exchanges have been accused of, in the past few years.
Around March this year, Binance Cryptocurrency exchange was accused by the Justice Department and Internal Revenue Service (IRS) of engaging in money laundering and attempting to evade tax.
Robinhood exchange on the other hand was charged by the SEC for dubious acts concerning its revenue services. The exchange had allegedly restricted users’ access to some of its services at crucial times in a bid to manipulate the market.
Although, CEXs make it easier for users to buy and sell crypto assets, but they also come with a lot of flaws. However, just like many other crypto enthusiasts, Elon Musk agrees that decentralized wallets are much safer to use than centralized wallets.