We have about the same differences between commercial banking and investment banking, and there are many economists arguing about the need to separate (or unite) these 2 activities. We shall have the same discussion with cryptos exchanges.
Many legislators around the world are talking about regulating exchanges, this is what they should talk about first.
It is true that there are two types of banking systems, one for investment banking and one for ordinary consumer banking. The products they offer are completely different from each other, and the regulatory requirements are also very different. I can understand the arguments that these two system should be kept apart from each other to reduce the risk for the customers. Investment banking is much more risky than the consumer banking that just offers loans and savings account. The thing is that traditional consumer banking seem to slowly disappear with technological advancements. Do we really need an institution in 2023 with many offices around the world and thousands of employees that only collects money and lends it out? The crypto community shows us that the is huge potential for p2p networks without a big institution in the middle. The problem I have with crypto exchanges just for buying and selling, and investment exchanges with more advanced products is that we usually want as many traders as possible on an exchange to get the best possible price. The higher the number of people buying and selling on an exchange the better it is to find a counterpart for our transaction. If we divide exchanges for their different purposes it could be hard to find some buyer or seller for our alt coins.