The basic idea is that the exchange or a central "site" never holds your money. You keep the money and hold it in your account until you make a trade.
If this is the case, the decentralized part of Bitshares is only when you are trading BTS and its derivates.
If you are using tokens issued by a gateway, then you are trusting that the gateway will let you trade and withdraw them. The gateway holds the actual tokens/fiat-currencies, not you.
Right - finally someone that can see this as well as me.
Yes the gateway part is an issue and I don't think there is any way around that at present. Atomic swaps may be a solution in the future.
Abundance of gateways would help a lot. But that doesn't seem to be happening. Even Bitshares has very limited choices.
Yes - I think Bitsquare doesn't use gateways (unless I'm mistaken) but I'm not sure exactly how they get around it. I assume they use some kind of mechanism by which their software straddles multiple blockchains?
Quick look: it seems to be a peer-to-peer system with multisig+arbitrators. Here is the whitepaper: https://bitsquare.io/bitsquare.pdf
Cool thanks! I will give it a read when I have a moment. I understand they may be looking at doing some kind of ICO so it could be something interesting to invest in.