Post
Topic
Board Service Discussion
Re: How can a CEX exchange protect user privacy without running into legal issues?
by
Pmalek
on 22/04/2025, 15:47:39 UTC
I'm looking for ways to defend user privacy and push back against authorities, but I have no intention of supporting terrorism or stolen funds.
And how are you planning to achieve that? You either have to cooperate with governments or law enforcement, which involves confiscating and freezing money or sharing certain types of data on your users if required, or you are not going to cooperate at all. Law enforcement always uses excuses such as financing terrorism or money laundering to collect data.

Keep in mind that possessing bitcoin that might have been used in criminal and illegal activities in the past doesn't make the current owner a criminal or the person responsible for what happened. I am not responsible for what the person who handed me a $50 bill did with that bill last Monday and law enforcement can't take it from me just because its history is bad. The same rules apply to UTXOs. Will you work with blockchain analysis in some form?

You plan to build a centralized crypto exchange(which means you are going to hold the coins of your users), but you also plan to stay non-KYC(which means that you won't follow any crypto regulations and laws). Is there any guarantee that you won't scam your users and you won't run away with their crypto?
Trust is built slowly and from zero. He will have to do it like any other service did it in the past. By offering an honest and fair service with the end-user's interests at heart. There are no guarantees that other centralized services won't one day decide to exit scam and run away despite being trusted for many years.