🔄 #CEXvsDEX101 – Centralized vs Decentralized Exchanges (Step-by-Step)
✅ Step 1: What is a CEX?
A Centralized Exchange (CEX) is a crypto trading platform managed by a company (like Binance or Coinbase). It acts as a middleman between buyers and sellers. Users must trust the platform to hold and protect their funds.
Pros:
Beginner-friendly interface High trading volume and fast execution Customer support available.
Cons:
Requires KYC (identity verification) Custodial – platform controls your crypto Risk of hacking or government shutdown.
🔓 Step 2: What is a DEX?
A Decentralized Exchange (DEX) operates on blockchain via smart contracts. No central authority is involved — you trade directly from your wallet.
Pros:
Full control over your assets Usually no KYC More privacy and transparency.
Cons:
More complex for beginners Less liquidity than CEX Slower execution during network congestion.
⚖️ Step 3: Which one to choose?
New to crypto? Start with a CEX for convenience.
Value privacy and control? Explore DEX platforms.
Many advanced users combine both!