How CloakX Solves the Problems Plaguing Centralized Exchanges
BYOB = Private & Secure Crypto Trading
The current cryptocurrency landscape is overflowing with bad actors. Within every corner of the blockchain lurks a fraudster intent on transferring digital assets from your wallet to theirs. And in the non-stop game of crypto protection, the main pieces on the board are your accounts’ private keys. Notice how the phrase begins with the word “private?” There’s good reason for that:
Private keys are meant to remain private
You see, when you send cryptocurrencies to a centralized exchange, you’re entrusting the organization with your private keys. Whether it’s Cryptopia or any other of the space’s multiple trade houses, making deposits means counting on a third-party to keep your funds safe.
Because you don’t own the private keys to your exchange accounts, you don’t really own the crypto you keep there, either. Plus, between hacks, exit scams, and generally shady business tactics, centralized exchanges are infamous for being the last place you want to keep significant funds.
In addition to security threats, breaches of privacy are also a concern. To trade more significant amounts of crypto, most exchanges require the submission of Know Your Customer (KYC) details. So, not only are you hoping that exchanges safeguard your funds, but you’re also trusting them to protect your passport or driver’s license.
Now, can we assume that the same outfits known for faking trade volumes and conducting in-house pump-and-dump schemes are qualified to keep our identities safe? Absolutely not!
What’s the answer to all of these issues? We’re glad you asked because as it turns out, CloakCoin has a powerful solution in the works. But before we tell you more, let’s discuss what you can do now to protect your funds.
One of the best methods for keeping your crypto from landing in someone else’s wallet is to employ hardware. No, we’re not suggesting you get out your hammer and nails. We’re talking about a crypto hardware wallet.
The primary benefit of hardware wallets is that your private keys never leave the device. There’s no need to trust a third-party to protect your funds. On the contrary, you need only trust yourself.
Don’t have a crypto hardware wallet? We strongly recommend their use. If you’re serious about the safety of your cryptocurrencies, the proper wallet is of utmost concern. Multiple companies offer them, and we can also teach you how to make your own.
Why all the talk of secure storage as opposed to trading? Well, as you’ll soon see, hardware wallets are a crucial component of our plans to build the world’s first truly private, decentralized cryptocurrency exchange (DEX).
Wallet-to-Wallet Crypto Trading
First and foremost, an authentic DEX allows users to retain possession of their private keys. And that aspect alone removes the need to rely on a counterparty trust — one of the riskiest factors when conducting any type of trade.
Be it gold or crypto or rare baseball cards, no matter the asset, trades revolve around both parties living up to their end of the bargain. And by transacting on a DEX, you’re relying on the consensus of a distributed computer network.
A true DEX acts as an intermediary between cryptocurrencies and human emotion — there’s no ego, greed, or ulterior motives.
Our upcoming hierarchical deterministic (HD) wallet is an ideal foundation for our new DEX. The CloakCoin network, having just celebrated its 5th birthday, is a well-established blockchain. Currently, our supporters operate more than 100 Proof-of-Stake nodes.
In other words, we already have a framework on which to create our own DEX. And in addition to enhanced privacy and security, that build-out brings several benefits:
- Mitigation of regulatory risks
If there’s one constant within the crypto space, it’s that international government cannot agree upon how to treat digital assets. FOMO, FUD, and policy flip-flopping are rampant.
And the best way to sidestep the uncertainty is to create a borderless system lacking any central point of attack. If a single node happens to go down, we’ve got 100 more to take its place.
- Secure integration with hardware wallets
To gain full access to CloakX, traders will hold a yet-to-be-determined amount of $CLOAK. And, as alluded to above, hardware wallets are the primary storage method for crypto-assets traded on our network.
As a privacy-first blockchain project, we’re excited about our future products. Rather than succumb to the dictatorship of centralized exchanges, we’re forging our own path and creating a new avenue for crypto trading.
Users of CloakX always keep their private keys private, while still enjoying 6% annual staking rewards. And, by encouraging DEX users to hold $CLOAK, our network becomes stronger with every new addition.
By default, CloakX users are stakers earning passive income for helping keep the Cloak network secure. And, our recent partnership with Chainsulting — Germany’s foremost experts on blockchain and digital assets — is already accelerating the DEX’s progress.
Trust us; we’re just as anxious as you are. We can’t wait to put a genuine DEX into the hands of the faithful CloakCoin supporters. That said, it’s imperative that our new product functions as intended. In other words, we’ve still got some building and bug hunting to do!
Patience is a virtue, and we’ll reward you for yours. When CloakX is ready, you’ll be the first to know!