Bitcoin was designed as a peer-to-peer cryptocurrency, but as the network expanded, there was no way to avoid the growing influence of centralized crypto exchanges. Soon after Bitcoin’s launch, more people wanted to enter the system. While mining was an affordable option at the time, buying crypto with fiat money was more convenient, especially for those who didn’t know how mining worked. The emergence of digital platforms that converted fiat to crypto and vice versa was a natural consequence.
In the first years, crypto exchanges represented an underground space, but one particular platform managed to monopolize the market — Tokyo-based Mt. Gox. In 2014, the service accounted for 70% of all Bitcoin transactions. Everyone knows what happened next — about 850,000 Bitcoin was stolen from Mt. Gox’s wallets, which were worth a total of $450 million at the time. This was when crypto exchange operators realized that security should be the highest priority in order to maintain client trust. As for Mt. Gox, it was forced to declare bankruptcy.
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