Although, I do believe this is where Bitcoin should be the outlier, we've gone through all this work to assure that people are free to hold their own money, and be responsible for it, why would we then want to encourage the same capitalistic ideals, that corrupts traditional fiat companies?
Absolutely agree. The very first line of the whitepaper talks about avoiding financial institutions, which is exactly what exchanges are. The whole point of bitcoin is lost when you let an exchange dictate what you can do with your bitcoin.
Something which exchanges should be caring about, but the truth of the matter is they don't
Because they know they don't need to. Binance are hacked for user data and coins - continues to be massively popular. Coinbase sold user data, insider traded, scammed their users - continues to be massively popular. Huobi admitted to being fractional reserve and using customers' money to hand out risky loans and investments for their own profit at their users' risk - continues to be massively popular. Robinhood frozen buying and selling for regular users, causing them to lose huge amounts of money, to protect the interest of their hedge fund buddies and CEO - continues to be massively popular. Not only do we see people continuing to use these exchanges, but they even defend them with nonsense statements which can be summarized as "Well, it's never happen to me, so therefore it's fine."
When exchanges can get away with constantly abusing their subservient users with literally no repercussions, then they have no incentive to change.