I don't get the point of your forum thread.
All crypto exchanges are regulated(or they should be). It doesn't matter if they offer just "crypto to fiat and vice versa" financial services or crypto trading/leverage/margin trading financial services. The authorities might distinguish them, but they are both regulated. In both types of crypto exchanges the users have to submit KYC verification, just like in all fiat financial services.
It doesn't matter if you are using a commercial or an investment bank, in both cases you have to submit KYC verification.
Separating the exchanges into different categories isn't our job. I guess that they are already separated by the regulators.
regulation is not just about "KYC"
yes with bitcoin defined as a currency then businesses offering services to move it are defined as financial businesses that should be regulated.. but there are many regulations. many policies and many services/features of regulations involved
for instance the difference between a non-custody swapshop. vs a custodial portfolio manager investment firm. is that the second version would need some CONSUMER PROTECTION INSURANCE
yep many dont realise that regulations are "suppose" to be to protect consumers. and so thats exactly what they should be.