Coming from stock trading, if an exchange offers margin trading, individual or entity can borrow our ADA and short it. If our ADA is not in an exchange, they cannot borrow our coins to short. Is my assumption correct?
I’m waiting for Nano S Ledger support to move all my ADA out of exchange.
I would agree if the exchange is fully regulated/audited like in the US. Unregulated exchanges can “print” any amount of currency on their ledgers and trade anyway they like. They are not required to actually show that they have the underlying so taking your crypto out of them may not affect their “shorting” capability.
Good news is that they won’t be unregulated for long. I think centralized exchanges should not be left unregulated… there is too much temptation to defraud, front-run or otherwise screw with investors. I don’t trust them.
I would still keep my crypto off the exchanges but mainly for safety purposes.