I'm a developer and have been familiar with cryptography / hashing algorithms since the mid 90's having written my own (insecure but good enough) cryptography for software registration. I'm not talking about the blockchain itself, but the exchanges subverting / diverting transactions away from blockchain based proof. When you say "I don't think Bitcoin works that way", you seem to be saying that exchanges can't create central databases that never submit transactions to the mempool.