Do exchanges actually need to back up crypto transactions with anything? I am talking about exchanges where you can’t actually deposit/withdraw crypto (etoro, revolut, paypal, etc).
Big crypto exchanges (binance, kraken, etc) do have crypto stashes to back trades.

I did not find any public information explaining that, thus my question.

Considering transaction back-up is not needed (I’m inclined to say that as a lot of trades aren’t really on the blockchain - even trades done on crypto exchanges), does it really matter that some cryptos have limited supply? BTC has only around 22 mil coins but if we have abstracted away and can trade without limiting to only the underlying asset, it means we’re just delusioned into burning money.

At this point I’m not even sure stock market is not in the same boat. I mean, has anyone ever been unable to buy a share for a specific company just because there isn’t any left?