#CEXvsDEX101

When it comes to cryptocurrency trading, two major types of exchanges exist — Centralized Exchanges (CEX) and Decentralized Exchanges (DEX). Each has its own advantages and limitations, depending on a trader's needs and preferences.

A Centralized Exchange (CEX) is a platform managed by a company or organization where users deposit funds and trade through the company’s system. Popular CEXs include Binance, KuCoin, and Coinbase. They offer high liquidity, fast transactions, and customer support but require KYC and trust in a third party.

On the other hand, a Decentralized Exchange (DEX) operates without any central authority. Traders interact directly with smart contracts on the blockchain, retaining full control of their assets. Popular DEXs include Uniswap, PancakeSwap, and SushiSwap. Although DEXs offer better privacy and security, they sometimes have lower liquidity and higher gas fees.

Understanding the difference between CEX and DEX is crucial for risk management and making the right decision based on market conditions.