The competition among CEXs reminds some people of the rivalry between Tencent and Alibaba, but it’s both similar and different. Here’s the simple logic: internet giants are still constrained by the so-called 'genetic theory,' meaning Tencent will never succeed in e-commerce, and Alibaba will never conquer social networking. This is because the moat of web products lies in user relationships and usage habits. Social relationships are built over time, e-commerce relies on the accumulation of trust systems, and content depends on creator ecosystems. All of these require long-term cultivation and cannot be replicated in the short term. But in the Crypto world, there’s only one moat: liquidity and the wealth effect. Whoever has the deepest liquidity can offer the best trading experience. Whoever can create a wealth effect can attract the most users and siphon funds. Whoever has pricing power becomes the rule-maker. In other words, this is a market purely driven by capital and traffic. Because they control the largest liquidity pools, CEXs seem capable of succeeding in almost anything they try. That’s why the evolution of CEXs has been so rapid in the past two years—they’re building trading platforms, wallets, Launchpads, VCs, public chains, DEXs, MEME launchpads, and more. Whenever there’s innovation in the industry, CEXs have the capability to copy it, and often do it better. The so-called competition and market order can essentially be ignored by CEX giants with absolute liquidity advantages. What’s even harsher is that competition between CEXs is theoretically 'winner-takes-all.' The stronger the liquidity, the more attractive the platform becomes, and the Matthew Effect continuously reinforces the dominance of the top players. Is this 'healthy'? Honestly, in the face of liquidity hegemony, this question no longer matters. This is the re-enactment of the internet giants’ 'copying is innovation' logic in the Crypto world, except this time, even the final barrier of 'genetic limitations' is gone.