#CEXvsDEX101
Let’s break down #CEXvsDEX101 — a beginner-friendly guide to understanding the difference between Centralized Exchanges (CEX) and Decentralized Exchanges (DEX):
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🔐 CEX (Centralized Exchange)
Examples: Binance, Coinbase, Kraken
Operated by: A centralized company or organization
User Experience: Beginner-friendly, fast transactions, high liquidity
✅ Pros:
Easy to use with customer support
High trading volumes = better liquidity
Advanced features like margin & futures trading
Fiat on-ramps (buy with credit card, bank transfer)
❌ Cons:
Not your keys, not your crypto (custodial)
Risk of hacks or government shutdowns
Requires KYC (Know Your Customer)
Centralized control over assets and decisions
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🌐 DEX (Decentralized Exchange)
Examples: Uniswap, SushiSwap, PancakeSwap
Operated by: Smart contracts on a blockchain
User Experience: You hold your own funds (non-custodial)
✅ Pros:
Full control over your funds
No KYC – privacy focused
Permissionless (anyone can list tokens)
Resilient to censorship
❌ Cons:
Learning curve for beginners
Slower transactions (depends on network)
Lower liquidity on some pairs
No customer support
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🔄 Key Differences
Feature CEX DEX
Custody Exchange holds funds You hold your own funds
KYC/AML Required Not required
Liquidity High Varies
Speed Fast Slower (depends on blockchain)
Control Centralized Decentralized
Risk Hacking, regulatory risks Smart contract bugs
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🧠 TL;DR
Use CEX if you're a beginner or want speed & convenience.
Use DEX if you value privacy, control, and decentralization.
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