5 ms·
With an exchange, your counterparty is the exchange.
by NovemberWhiskey 5y ago
With an exchange, your counterparty is the exchange.
- ycombobreaker 5y agoIs that really true? On traditional exchanges, the exchange itself is a mostly neutral party, a technology-and-marketplace provider. If a clearing member becomes insolvent, the other clearing members have agreements in place to "pitch in" together to keep the whole system functional. (Edit: to be clear, this isn't a rosy situation: it's usually a adjacent to fraud, so the SEC, CFTC, etc. pursue criminal charges; and other clearing members tend to sue the bankrupt one, letting the courts figure it out.)
- NovemberWhiskey 5y agoThe cryptocurrency "exchanges" are not structured similarly to the stock market. There's no separation of broker, matching venue and central counterparty clearing service.
- bonestamp2 5y agoIt depends on the exchange. Some are peer to peer and some trade from their hot wallet.
- NovemberWhiskey 5y agoHow does a peer-to-peer exchange work? They match you with someone and then you find some way to do a swap, potentially cross-chain?