Crypto exchanges risk losing part of market to blockchains
Centralized exchanges remain the main gateway to the crypto market, but some of their functions are already moving onchain. Spot trading, perpetual futures, tokenized stocks, and swaps between different assets are gradually becoming available without traditional exchange infrastructure, according to NEAR Protocol co-founder Illia Polosukhin.
He said centralized exchanges are no longer necessary for many operations. Hyperliquid Policy Center CEO Jake Chervinsky goes even further: in his view, even the largest traditional exchanges will have to use public blockchains within the next decade, The Block reported.
Trading is moving onchain
According to Polosukhin, key CEX functions can already be moved into an onchain environment. Users can trade assets across different networks, access tokenized stocks and yield products, and trade perpetual futures through a single interface.
The next step is closer integration with traditional money. Blockchain projects are developing bank transfers, fiat-to-fiat exchange, and withdrawals to bank accounts. In this model, users no longer have to move assets to a centralized exchange for every transaction.
Chervinsky believes public blockchains will eventually become core infrastructure for trading platforms themselves. This applies both to crypto companies such as Coinbase and Kraken and to traditional exchanges such as CME Group and Intercontinental Exchange.
At the same time, exchanges are unlikely to disappear completely. They may retain their role as interfaces, liquidity providers, operators of regulated products, and intermediaries between blockchains and the banking system.
Regulation remains the main barrier
In the U.S., registered platforms are already allowed to offer some crypto derivatives, but broader use of public onchain infrastructure remains a more complex regulatory issue.
If regulation continues moving in this direction, exchanges could gradually evolve from closed trading systems into services built on top of public blockchains. Their competitive advantage would then come less from proprietary settlement systems and more from providing convenient access to open infrastructure.
Exchanges are not going anywhere yet
Despite the growth of onchain services, centralized exchanges still serve tens of millions of users and remain the easiest way for many people to buy, sell, or withdraw cryptocurrency. They offer familiar interfaces, customer support, access to fiat payments, asset custody, and a range of trading tools that most users find easier to access in one place.
That means CEXs are unlikely to disappear anytime soon. Their role is more likely to evolve as more activity moves onchain. Exchanges may lose some functions, but they can retain users through convenience, liquidity, regulatory compliance, and links to the banking system.
As a reminder, Coinbase plans to relaunch Coinbase Pro and expand access to derivatives through its global exchange.
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