> No one expects a multi-billion dollar exchange to vaporize over night.

Except for everyone who has?

We don't expect banks to vaporize because they're FDIC-insured with extreme regulations on their lending/investing, highly regulated.

But crypto exchanges are the wild west. Totally vulnerable to both hacking and ponzi scheme fraud. Essentially zero regulation or customer insurance. And "vaporizing over night" is how it always goes -- to quote the famous phrase, you go bankrupt slowly and then all at once.

So it's actually incredibly unreasonable to trust a company with essentially zero oversight to hold your funds.

And sure, there can be a movement towards more openness about funds/audits. But now customers have to decide... which auditors can be trusted to review the numbers, when it's the exchange selecting and paying the auditors? How can you even know? And do the auditors provide any defense against hacking?