And projecting this thought to the crypto exchanges, what if some well known CEX do not have enough BTCs that is being traded on that exchange? All that numbers and volume could be fake. Then the CEX is becoming like a traditional bank, where unless everyone will want to withdraw their BTCs, they are ok trading non existing BTCs.
well, what do you think?
But we had very perfect examples not so long ago. FTX became insolvent, and they had no funds/Bitcoins to issue to people who made withdrawals because they had misused customer funds, making the exchange to collapse and file for bankruptcy.
So many other services also experienced the same thing such as Celsius network, BlockFi etc