You can replace all this wall of text for:
Remove your money from exchanges and put them in a wallet where you hold your private keys.
Nothing is ever 100% safe, even with your private keys hidden someone can physically attack you and torture you until you give them up. In some cases people feel safer with a 3rd party. Not everyone wants to be their own bank.
You are right but the true essence of crypto wont really fit out yet entrusting your funds will be most likely with fiat banks.Nothing is really safe but
holding your funds with your own wallet do really gives out some convenience compared to other.