#CEXvsDEX101 # CEX vs DEX 101: Centralized vs Decentralized Exchanges

## Key Differences at a Glance

| Feature | CEX (Centralized Exchange) | DEX (Decentralized Exchange) |

|---------------|---------------------------|------------------------------|

| **Control** | Company-operated | Algorithm/community-operated |

| **Custody** | Holds user funds | Users control their funds |

| **Anonymity** | KYC required | Often anonymous |

| **Liquidity** | Generally high | Can be fragmented |

| **Speed** | Fast transactions | Slower (blockchain speed) |

| **Fees** | Higher trading fees | Lower fees, but gas costs |

| **Assets** | Wide variety | Mostly crypto-only |

## Centralized Exchanges (CEX)

**Examples:** Binance, Coinbase, Kraken

**Pros:**

- Easier for beginners

- Fiat on/off ramps

- Higher liquidity

- Advanced trading features

- Customer support

**Cons:**

- Custodial risk (hacks, insolvency)

- Requires identity verification

- Subject to regulations

## Decentralized Exchanges (DEX)

**Examples:** Uniswap, PancakeSwap, dYdX

**Pros:**

- Non-custodial (you control keys)

- No KYC requirements

- Global access

- Transparent operations

- New token availability

**Cons:**

- Steeper learning curve

- Smart contract risks

- Limited fiat options

- Potential liquidity issues

- Irreversible errors

## Which Should You Use?

**Choose CEX if:**

- You're new to crypto

- You want to trade fiat currencies

- You need high liquidity

- You prefer convenience

**Choose DEX if:**

- You prioritize self-custody

- You want privacy

- You're trading newer tokens

- You're comfortable with DeFi

Many experienced traders use both types depending on their needs.