#CEXvsDEX101 🔄 CEX vs DEX 101
🏛️ CEX (Centralized Exchange)
What it is:
A centralized exchange is a platform operated by a company that acts as an intermediary between buyers and sellers of cryptocurrencies.
Examples: Binance, Coinbase, Kraken, Bitfinex
Characteristics:
Centralized control: The company controls the funds, private keys, and infrastructure.
Mandatory registration (KYC): Users need to provide personal data.
High liquidity and speed: Many buy and sell orders, with fast execution.
Ease of use: User-friendly interface and customer support.
Advantages:
Easier for beginners
Customer support
Generally higher liquidity
Disadvantages:
Less privacy
Risk of hacks (platform is a target)
You do not have full control over your funds
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🌐 DEX (Decentralized Exchange)
What it is:
A decentralized exchange operates on blockchain networks, allowing trades directly between users, without intermediaries.
Examples: Uniswap, PancakeSwap, SushiSwap, dYdX
Characteristics:
No intermediaries: Peer-to-peer exchanges via smart contracts
You control your funds: The private keys remain with you
No need for KYC: Anonymity in most cases
Advantages:
Greater privacy and control
Lower risk of censorship or account blocking
Total transparency via blockchain
Disadvantages:
Interface may be more complex
May have lower liquidity
Network fees (gas fees) can be high
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🤔 CEX or DEX? Which to use?
It depends on your profile:
Beginner, looking for simplicity? CEX.
Advanced, want more control and privacy? DEX.
Want to diversify? Use both as needed.
