
Another Fallout from a Major Exchange? Yeah, Probably.
Let’s not dance around it — the crypto industry has a habit of building skyscrapers on swampland. And when the foundations shift, things come crashing down fast. So when people ask, “Could we see another major exchange collapse?” the answer isn’t just “yes.” It’s “why wouldn’t we?”
Because despite the wreckage of FTX, Quadriga, Mt. Gox, and other cautionary tales from the graveyard of centralized trust, the ecosystem still leans hard on a few key players who operate like casinos dressed up as banks. The incentives haven’t changed. The opacity hasn’t changed. The users — us — haven’t changed much either.
The Myth of “Post-FTX Maturity”
FTX’s implosion was supposed to be a watershed. Regulators woke up. Users got skittish. CEXs started tweeting about proof-of-reserves and internal audits like they’d just discovered religion.
But here’s the thing: proof-of-reserves without proof-of-liabilities is theater. And most exchanges stopped pushing those transparency updates once the heat died down. Binance, for instance, made a big show of publishing wallet addresses, then quietly slowed updates. Others just shrugged and hoped everyone forgot.
Meanwhile, regulators have been throwing spaghetti at the wall — sometimes landing real punches (see: SEC vs. Coinbase), other times just flailing in public. But as of today, there’s still no global standard for how exchanges should safeguard assets. The Wild West is still open for business.
Who’s Next?
I won’t name names like it’s a prediction market, but here’s the checklist for potential fallout candidates:
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Heavily rehypothecated assets
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Unclear custody arrangements
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Aggressive yield offerings
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Opaque corporate structure
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Slow withdrawals when things get spicy
If an exchange checks more than two of those boxes, it’s a timebomb. Especially in a liquidity crunch — say, Bitcoin dumps 40% in a week and everyone tries to exit at once. Or a big ETF gets delayed. Or some whale gets liquidated on leverage and sets off a margin-call domino.
We saw something eerily similar last year with Prime Trust. One minute they’re handling custody for half the neobanks in the U.S., the next they can’t find customer funds. Sound familiar? It should. These failures often rhyme.
The Decentralization Mirage
You’d think all this would push users toward DeFi, but let’s be honest: DeFi isn’t immune to the same risks, just mirrored through smart contracts instead of suits.
Remember Curve’s Vyper bug? Or the half dozen bridge hacks in the last twelve months? At least with CEXs you get someone to blame. In DeFi, you’re just screaming at a multisig on Discord.
That said, a real DeFi alternative to centralized exchanges is long overdue. Not just some sludgy AMM interface, but an actually usable, performant, permissionless trading experience. We’re not there yet. And until we are, people will keep parking their coins on shiny centralized platforms because they’re convenient, fast, and (seemingly) safe.
What Could Trigger the Next Collapse?
Here’s the shortlist of powder kegs:
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Regulatory chokehold: Especially in the U.S. or EU, where compliance costs are crushing smaller players.
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Banking partners cutting off access: We’re already seeing banks get skittish again.
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Stablecoin depegging: Tether’s doing fine until it isn’t. Remember Terra?
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Exchange token meltdown: If an exchange props up its balance sheet with a native token and that token tanks… well, see FTT.
Any of these could crack the veneer. And when the music stops, most users won’t know where their funds actually were — on the exchange, in an omnibus wallet, in a side-pocketed lending pool?
So What
Expect another major exchange to collapse. Maybe not tomorrow. But eventually. Probably when markets get chaotic again and all the stress-tested promises turn out to be stress-fantasies.
Best-case scenario? It’s a smaller one, and the contagion is contained. Worst-case? It’s another FTX-level implosion, and we all have to sit through another round of Senate hearings where no one can explain crypto without sounding like they just learned about it yesterday.
Self-custody, people. Use it. At least then, when things burn, you’re holding the ashes.
— John van Rijck, Analyst at AllCryptoWhitepapers.com