🌐In the world of crypto trading, there are two main types of exchanges: Centralized Exchanges (CEX), Decentralized Exchanges (DEX)
— Centralized Exchange (CEX)
A CEX is controlled by a central company or authority. It’s like a traditional bank where you trust the platform to handle your funds and trades. Examples of CEXs include Binance, Coinbase, OKX and ByBit
• Ownership: A single entity or company manages the exchange.
• Security: You give the exchange control of your funds, and they protect them with their security systems.
• Registration: You need to sign up and often complete KYC (identity verification).
• Location: The company is based in specific regions or countries, so they are subject to local regulations.
— Decentralized Exchange (DEX)
A DEX is different because it doesn’t have a central authority controlling it. Instead, trades happen directly between users through smart contracts on a blockchain.
• Ownership: No single company owns the platform. It’s usually governed by smart contracts.
• Security: You have full control over your own funds and trades. No need to trust a third party.
• Registration: No need for identity verification (KYC), allowing for more privacy.
• Location: DEXs are spread globally because they exist on blockchain networks, not tied to any country.
— Centralized Exchange (CEX)
A CEX is controlled by a central company or authority. It’s like a traditional bank where you trust the platform to handle your funds and trades. Examples of CEXs include Binance, Coinbase, OKX and ByBit
• Ownership: A single entity or company manages the exchange.
• Security: You give the exchange control of your funds, and they protect them with their security systems.
• Registration: You need to sign up and often complete KYC (identity verification).
• Location: The company is based in specific regions or countries, so they are subject to local regulations.
— Decentralized Exchange (DEX)
A DEX is different because it doesn’t have a central authority controlling it. Instead, trades happen directly between users through smart contracts on a blockchain.
• Ownership: No single company owns the platform. It’s usually governed by smart contracts.
• Security: You have full control over your own funds and trades. No need to trust a third party.
• Registration: No need for identity verification (KYC), allowing for more privacy.
• Location: DEXs are spread globally because they exist on blockchain networks, not tied to any country.