A comprehensive survey of cryptocurrency investors has revealed a significant erosion of trust in centralized exchanges (CEXs), with 45% of respondents stating their confidence has declined since 2022. The 2025 survey, which polled 375 Cointelegraph readers, found that only 16% reported improved trust, while 19% saw no significant change. A further 20% noted a slight decrease, meaning a combined 65% majority expressed some level of diminished confidence.
The survey pinpointed three primary drivers behind this trust deficit. Exchange hacks and security breaches were the top concern, cited by 33% of investors. High-profile cyberattacks resulting in user fund losses remain a persistent vulnerability in centralized custody models. The second most cited reason, at 27%, was the collapse of major platforms, most notably FTX in November 2022. This event demonstrated that size and reputation offer no absolute guarantee of safety, raising critical questions about corporate governance and financial transparency.
Regulatory restrictions formed the third pillar of concern, noted by 26% of participants. Evolving regulatory landscapes in the United States, Europe, and Asia have created operational uncertainty. While aimed at consumer protection, some investors perceive new rules as restrictive, creating tension between compliance and the decentralized ethos of cryptocurrency. The period since 2022, marked by the Terra/Luna collapse and subsequent failures of crypto lenders, serves as a crucial benchmark for this shift in sentiment.
The declining trust is correlating with observable shifts in investor behavior. On-chain data suggests increased activity in decentralized finance (DeFi) protocols as some users migrate toward non-custodial solutions. Key behavioral changes include reducing custodial holdings on exchanges in favor of private wallets, intensifying due diligence on security audits and corporate structure, and diversifying assets across multiple platforms to limit single-point exposure.
Industry analysts note that trust is a lagging indicator. Despite exchanges implementing stronger proof-of-reserves, enhanced custody solutions, and greater transparency initiatives since the 2022 crises, rebuilding user confidence requires sustained evidence of security and reliability. The path forward for exchanges centers on multi-faceted credibility-building: regular, verifiable proof-of-reserves by independent auditors, clear communication on regulatory status, advances in cryptographic custody like MPC wallets, and the provision of insurance funds for potential breaches.
