transactions [3] [5] [6]. Gas fees on Ethereum-based DEXs can be significantly higher than trading on CEXs [7] [15].
The Future of CEXs and DEXs
Custody: CEXs hold user funds, while DEXs allow users to retain control of their assets [3] [5] [6].
Regulation and KYC: CEXs comply with regulations and require KYC, while DEXs often do not [3] [5] [6].
Security: DEXs reduce the risk of a single point of failure, but smart contract vulnerabilities can pose risks [3] [5] [6]. CEXs are targets for hacks [7] [19].
Liquidity: CEXs generally have higher liquidity [3] [5] [6].
User Experience: CEXs are generally easier to use [3] [5] [6].
Fees: DEXs often have lower trading fees, but gas fees must be considered [5] [7] [15].
The ideal strategy for many users is to combine CEX speed and DEX visibility, potentially using an API provider that aggregates both streams under one format [4].
Industry experts predict continued growth for both CEXs and DEXs in 2025 [1]. CEXs will likely remain crucial for onboarding new users, while DEXs will continue to evolve and play a more central role in the broader financial ecosystem [1] [5].
Conclusion
DEXs are also innovating. For example, Paradex Network allows traders to access 20x leverage for HYPE/USD pairs exclusively on their DEX [2].
The choice between a CEX and a DEX depends on individual needs and priorities. CEXs offer convenience and liquidity, while DEXs prioritize user control and privacy. Both types of exchanges play a vital role in the evolving crypto landscape
