Time to put all these frauds in jail and wrap up the crypto saga. Good practical demonstration why regulation and traditional finance work the way they do.
How do decentralized exchanges convert USD to crypto and back again? Especially given all the legal compliance requirements. This seems impossible without a central service / legal entity.
This is a very good question. They cannot and do not.
On/off-ramps are a huge topic and we have a lot of work to do to make these ramps as permissionless as possible, should we want to allow humans to decide for themselves whether or not to comply with (potentially) tyrannical governments.
If it wasn't for the goldrush enabled to large part by the exchanges cryptocurrencies would still be some technology used by some nerds in their basements to pay each other for pizza. Let's be real, almost nobody uses crypto as an actual payment method. It's all just get rich schemes too good to be true.
So why you're correct in principle, it would be of no relevance if everyone self-custodied (also let's not ignore the bugs crypto contracts)
