The few actual decentralized exchanges are too slow and expensive.
Key part:
> fully onchain perpetual futures and spot order books
That's one of the sticking points I have with the /idea/ of the technology
and not only will other people worldwide use it immediately, they will also pay for all your infrastructure costs as they update the chain state with every transaction fee that they pay
the permissionless nature means you can deploy anything as cenralized or decentralized as you want, and its up to consumers to be discerning and its only their fault if they are not
cost wise this will always be attractive to developers and for them to bring over every audience they can muster, because web 2.0 cloud cannot compete with that cost structure and permissionless nature
It was supposed to be limited in supply unlike fiat, and yet Tether underpins the whole thing and they print that out of thin air all the time. It was supposed to be decentralized, but in practice a few big exchanges control all the transactions and a few big mining pools control all the minting. It was supposed to be "code is law", and yet if you find a big exploit on smart contracts it'll be unwound later on and the cops will still show up for you. And as you say, it was supposed to be trustless, but counterparty risk is everywhere.
And it turns out nobody cares, because to a first approximation nobody is in crypto for the libertarian principles. It is all about number go up; always has been, always will be. It's not even worth pointing out anymore.
This is a joke right? Tether (USDT) is pegged to the dollar... and there is not really a limit to the USD printing machine, nobody ever claimed a stablecoin would have a limited supply. It's literally the main critique of the fiat system levied by crypto proponents.
The only asset which has made and still hold promises of not increasing its supply over its limit set through its consensus code is Bitcoin. And it is nowhere close to ever change... as a matter of fact if it changed, most people wouldn't call that fork Bitcoin.
I agree 100% - Meme stocks go brrrrrrrr
The idea that it's a currency that lives beyond the reach of governments is laughable (as soon as something goes bang a lot of the owners call for... regulators and government oversight)
Even the vast majority of free-market maximalists will support a government bailout of large banks or the auto industry if it will save their investment portfolio.
Patrick is largely correct on perp futures being mostly used as a leverage instrument to gamble on bitcoin or ether by retail. However I think he's missing one point which is that actually some institutional players also use CME futures to gain exposure to Bitcoin (e.g., BITO ETF or a pension fund that wants to gain exposure to crypto and have a fiduciary duty to hold assets with AAA custodians).
The thesis being that if you're an institution, you don't trust the relatively "fly-by" offshore crypto or even US-regulated custodians of crypto. When you trade CME bitcoin futures, your settlement is guaranteed by the clearing entities of Chicago Mercantile Exchange which are bulge bracket firms of TradFi. So why CME futures largely reflect a premium over the spot BTC price - and this premium is a function of the demand of bitcoin at anytime and the Fed fund rate. As the bitcoin futures market is highly efficient, the CME futures premium is arbitraged across the various DeFi and CeFi exchanges with basis points added relative to the default risk of each venue.
And the basis trade itself is not a "risk-free" arbitrage. The seller on the other side of gamblers are exposed to "right-tail" risk - your premium you get paid to "carry" the bitcoin is fixed while the collateral you must hold in theory to "hold" the coin on behalf of the buyer could be in theory infinite if bitcoin skyrockets to infinity. Sell too much and you might not have enough collateral before the futures settlement happens (for a fixed term futures, not perps) kind of like a reverse but still deadly scenario with Silicon Valley Bank (i.e., you incur "paper loss" that goes away if you can hold it to expiry; but you get force liquidated before then).
The real risk is to be auto-deleveraged when the other side blows up and no one is here to buy its long. Then the perp exchange closes your short and you have a naked long.
The CME clearinghouse itself is the guarantor. And below it are the clearing firms. The trading firms don't guarantee trades, the clearing firms do.
In fact, for many products, the CME is the counterparty for both sides of a trade.
Dark markets are still active and people move large amounts across international borders effortlessly.
As an example of being effectively anonymous, I can easily take some cash, meet up at a cafe nearby with someone from a p2p site to swap it to crypto, and then pay a foreign company for hosting services for years with that crypto, sharing zero personal information.