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Within the physical world, a bank is a lender licensed to receive deposits, transfer funds, and store money for its clients. Banks can legally provide right to exchange one fiat currency for one more towards the customers.

In the digital world, a cryptocurrency exchange provides services much like banking for their clients; additionally, exchanges be such as a stock exchange.

Just what cryptocurrency exchange?

A cryptocurrency exchange is really a borderline illegal online marketplace where users can exchange one form of digital asset for the next depending on the rate of the given assets. The challenge with cryptocurrency exchanges is because they often facilitate the trade of unregistered securities, are often used to launder money, and still have limited, or no, AML/KYC to enable them to evade legislation.

Cryptocurrency exchanges played a substantial role in the ICO boom of 2017. Cryptocurrency exchanges were looking forward to new projects without having real business design, product, or future to produce so they could list these projects on the exchanges and make huge amount of money in transaction fees from all of these trading pairs. That being said, you can imagine a cryptocurrency exchange as a bucket shop.

What is a cryptocurrency?

There are many features that distinguish digital currencies from cryptocurrencies.

Cryptocurrencies are coins and tokens without any real purpose-they don’t have utility and they also are created absolutely free more than speculative purposes and also to facilitate crime.

Unlike digital currencies, most cryptocurrencies do not adhere to law; in reality, some cryptocurrencies were even created to evade regulations. Privacy coins are cryptocurrencies specifically made to facilitate crime by obfuscating the trail a transaction has traveled from sender to recipient.

Ultimately, cryptocurrencies are tools utilized to enable crime, whether that be fraud, money laundering, or racketeering, while digital currencies are protocols which allow the digitization of data and funds.

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