Wall Street Questions Crypto Exchanges' 'Decentralized' Security Promises

Crypto exchanges often tout “decentralized” and “trustless” systems as safeguards for assets, yet the platforms retain centralized control over custody, trading and risk management. That has prompted Wall Street to question their security promises. The debate could influence whether institutional capital enters the market and underscores that protecting user assets cannot depend on brand messaging alone.

A recent report said more than $3 billion in crypto assets was stolen worldwide in 2025, highlighting persistent gaps in exchanges' existing safeguards and internal controls. Author Gracy Chen argued that security should be embedded in day-to-day operating standards rather than used as a marketing slogan, and called on regulators to strengthen enforcement and accountability.