#CEXvsDEX101

The difference between a DEX and a CEX

You keep your private keys and eliminate the risks of account freezing. However, they require more technical knowledge and may have higher network fees. In a CEX, your cryptocurrencies are entrusted to the platform, so it’s as if they don’t belong to you.

Do you buy, sell, or trade cryptocurrencies? You probably use a cryptocurrency exchange platform to carry out your transactions. These platforms can be centralized or decentralized, a fundamental design decision that affects nearly every aspect of your trading experience.

Decentralized exchanges, like the blockchain technology that underpins them, rely on consensus mechanisms, with data distributed among users. However, centralized exchanges are undeniably more accessible. Which one should you choose? The decision is based on trade-offs and priorities.

Key points

Centralized exchanges are the easiest to use, but perhaps the least secure.

Decentralized exchanges offer the highest security and privacy.

You can use a combination of both types of exchanges.