Correct. All of the big unlicensed and unregulated exchanges that provide no transparency of their ownership, or as to how customer balances are held allow significant margin trading. And they have no impartial 3rd party proof of reserves.
Many major exchanges have financial institution licenses. It's not a banking license, but it's a license that still means a lot of regulation. (Also the history has shown that a banking license is in no way a guarantee that a bank cannot fail.)