#CEXvsDEX101
Centralized Exchanges (CEX)
Examples: Binance, Coinbase, Kraken
Key Traits:
Managed by companies that oversee operations, security, and custody of assets.
Custodial: You deposit funds into the exchange's wallet; they control your private keys.
User-friendly: Intuitive UI, customer support, fiat on-ramps.
High liquidity and faster transaction speeds.
Pros:
Easier for beginners
More trading features (limit orders, margin trading)
Better customer service
Cons:
Centralized control = risk of hacks or mismanagement
You don’t own your keys
KYC/AML required (less privacy)
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🌐 Decentralized Exchanges (DEX)
Examples: Uniswap, PancakeSwap, dYdX
Key Traits:
Smart contract-based protocols running on blockchains (like Ethereum or BNB Chain).
Non-custodial: You control your private keys and assets.
No middlemen; trades are peer-to-peer.
Permissionless and privacy-focused.
Pros:
You keep full control of your crypto
Censorship-resistant and transparent
Typically no KYC
Cons:
Slower or costly (due to network fees)
Higher learning curve
Lower liquidity for some assets
