To address your questions about how trading is done and where the funds are stored, as well as KYC concerns, both trading and fund storage in TEX are conducted in a decentralized manner, similar to decentralized exchanges. Funds from liquidity providers are stored in smart contracts, while traders' funds are held in their own wallets. Just like decentralized exchanges, TEX does not require KYC verification.
There is still a point I don't fully understand, if you say that:
Both trading and storing funds in TEX is done in a decentralized manner, similar to decentralized exchanges. Funds from liquidity providers are stored in smart contracts, while traders' funds are held in their own wallets.
If TEX works like centralized exchanges what is the need then ERC-4337 social retrieval method, as long as everything is decentralized then you don't need to use your private key on the exchange, hence the need for a way to recover it.
Can this point be clarified, when using TEX do we need to use the private key of the wallet or not?