#CEXvsDEX101 CEXvsDEX101: Understanding the Fundamentals of Crypto Exchanges

"CEXvsDEX101" primarily aims to break down and explain the features, advantages, and disadvantages of Centralized Exchanges (CEX) and Decentralized Exchanges (DEX). Its function focuses on:

1. Defining What CEX and DEX Are:

* CEX (Centralized Exchange): It explains that a CEX is a cryptocurrency exchange platform operated by a centralized company (e.g., Binance, Coinbase, Kraken). It acts as an intermediary between buyers and sellers, similar to a traditional bank or brokerage. Users deposit their funds in the exchange and it holds them in custody.

* DEX (Decentralized Exchange): It details that a DEX is a platform that allows the exchange of cryptocurrencies directly between users (peer-to-peer) without the need for a central intermediary. They operate through smart contracts on a blockchain, and users maintain custody of their funds in their own wallets.

2. Highlighting the Fundamental Differences:

The main function of "CEXvsDEX101" is to draw a clear distinction between the two, covering aspects such as:

* Custody of Funds:

* CEX: The exchange has custody of your funds (your private keys are held by the CEX).

* DEX: You maintain full custody of your funds (your private keys are in your personal wallet).

* Intermediation:

* CEX: There is an intermediary (the exchange company) that facilitates transactions.

* DEX: There are no intermediaries; transactions are conducted directly between users through smart contracts.

* Regulation and KYC/AML:

* CEX: They are subject to government regulations and typically require Know Your Customer (KYC) and Anti-Money Laundering (AML) processes, which involve verifying your identity.

* DEX: Generally unregulated and do not require KYC/AML, offering greater anonymity.

* Ease.