Centralized cryptocurrency exchanges (CEXs) continue to play a crucial role in attracting mainstream retail adopters, despite the collapse of the FTX exchange that resulted in significant losses for users. According to Ruslan Fakhrutdinov, the founder and CEO of X10, centralized exchanges will lead the way in onboarding the next 100 million retail adopters into the industry.
New investors are drawn to CEXs due to the trust they offer in the company and the user-friendly trading experience they provide. However, to attract more traditional retail investors, hybrid and decentralized exchanges need to enhance their user experience and marketing efforts.
X10, a hybrid exchange platform founded by former members of neobank Revolut, aims to bridge the gap between centralized and decentralized exchanges. Its infrastructure features a hybrid central limit order book that settles trades onchain through StarkEx’s layer-2 engine.
Following the collapse of FTX, which highlighted the vulnerabilities of centralized exchanges, hybrid exchanges are emerging as a middle ground that combines the best of both centralized and decentralized exchanges. Fakhrutdinov believes that the next generation of exchanges should be trustless but not necessarily permissionless.
In a positive sign for institutional adoption, Robinhood recently announced its acquisition of Bitstamp in a $200 million deal, allowing the app to serve institutional clients in the United States. Revolut has also launched its crypto exchange for UK users, indicating a growing interest in crypto among institutional investors.
Overall, the crypto industry is evolving, with hybrid exchanges playing a key role in reestablishing trust and attracting a wider range of investors. As the industry continues to grow and evolve, the role of centralized exchanges in onboarding new retail adopters remains crucial.