Investors are back into Bitcoin but DEXs are still the future of crypto

Bitcoin's long-waited bull run and the recent wave of corporate and institutional investors allocating significant portions of their reserves to Bitcoin are all signs that the pace of crypto's mainstreaming is rapidly accelerating: But has the path to mass adoption come at the cost of privacy and decentralization?

Recently, regulators have begun to crack the whip and jurisdictions around the world continue to propagate further measures to ensure investors disclose their crypto holdings and pay taxes on their profits.

Roughly a week later, the Financial Conduct Authority, the United Kingdom's top regulatory watchdog, went as far as to ban investors from derivatives trading at all crypto exchanges.

All of these maneuvers are designed to force compliance on crypto service providers, and while they may eventually assist with furthering mass adoption, many crypto ideologues are looking for alternatives to press their case for financial self-sovereignty.

A growing number of investors feel that centralized crypto exchanges essentially operate in the same manner as traditional banks.

While some investors shun KYC and tax compliance, this is a serious matter for crypto service providers.

According to Molly Wintermute, an anonymous developer credited with founding Hegic DEX, compliance is more of an issue for centralized crypto service providers, not DEXs.

According to Wintermute, the number of investors actually using DEXs is quite small, compared to the total number of crypto investors.

"Decentralized derivative is a part of small crypto world. there r 100M+ of crypto holders globally. around 5-10 of them might b actively trading crypto derivatives. i don't think that FCA ban has opened any new interesting opportunities. nothing has changed."

In addition to addressing privacy concerns and restoring decentralization to the crypto sector, DEXs also provide a sandbox for layer-two developers to play in.