Discover How Mandatory KYC Systems Strengthen Digital Accountability And Transparency Against Fraud, Learning Lessons From MtGOX And FTX
Many people assume blockchain technology is a perfect defense built to stop all forms of financial fraud. It is known for being secure, transparent, and tamper-proof. So, when major centralized crypto platforms like MtGOX and FTX collapsed, the question naturally follows: “If blockchain is so safe, how did this happen?” The answer is straightforward: Blockchain technology does not prevent human dishonesty, it helps reveal it. Blockchain works by recording transactions in a way that is permanent and cannot be changed later. Once a record is written onto the blockchain, it stays there forever. This is excellent for keeping records clean and providing an auditable trail. However, it does not stop individuals from lying, stealing, or misusing customer funds before those transactions are officially created. In the cases of MtGOX and FTX , the issue was not the blockchain itself. It was the people and the centralized entities running the platforms. They had discretionary co...