Definition ∞ Centralized supervision describes a regulatory or governance model where a single authority or a limited group of entities exercises control and oversight over a system or market. In the context of digital assets, this typically involves government bodies or traditional financial institutions monitoring and directing activities. Such oversight aims to ensure compliance, maintain market stability, and protect consumers within the digital economy.
Context ∞ The debate between centralized supervision and decentralized governance remains a central discussion point in the cryptocurrency world. Many regulators advocate for greater centralized control over digital asset markets to mitigate risks associated with illicit finance and market manipulation. Conversely, proponents of decentralization contend that excessive supervision contradicts the fundamental principles of blockchain technology.
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