#CEXvsDEX101

CEX (Centralized Exchange) vs. DEX (Decentralized Exchange) 101

In crypto, you trade on either a CEX or a DEX.

CEX (e.g., Binance, Coinbase):

* Centralized: Run by a company, they hold your funds (custodial).

* Pros: User-friendly, high liquidity, often have fiat-to-crypto on/off ramps, customer support, advanced trading features.

* Cons: Custodial risk (funds can be hacked or frozen), KYC/AML requirements (less privacy), subject to regulations.

DEX (e.g., Uniswap, PancakeSwap):

* Decentralized: Operate on blockchain via smart contracts; you control your funds (non-custodial).

* Pros: Full control over assets, no KYC (more privacy), censorship-resistant, access to new/niche tokens.

* Cons: Less user-friendly, can have lower liquidity (higher slippage), no customer support, gas fees (network fees).

The choice depends on your priorities: convenience and features (CEX) vs. autonomy and privacy (DEX).