The question too often overlooked: how do we fund our wallet?
Whether you choose a CEX or a DEX, one thing is clear, you have to start somewhere. In the vast majority of cases, the entry is made through a fiat-to-crypto gateway, often offered by regulated CEXs like Binance.
You want to buy some $BTC , some $ETH or some $BNB to then use on a DEX? You will most likely go through a CEX, or a provider who will have completed KYC in advance. This is a fundamental point.
That being said, when getting into cryptocurrency, one of the first questions that arises is whether to use a DEX (decentralized exchange) or a CEX (centralized)??? The answer is not universal, as it depends on your experience, your level of autonomy, and especially your wishes, so here are some additional explanations that I hope will help clarify things for you.
The CEX: simplicity and user comfort
Centralized exchanges are platforms managed by regulated or unregulated companies. They offer a smooth user experience, ergonomic interfaces, and high liquidity. Buying, selling, staking, or even launchpads are accessible in just a few clicks.
However, the user does not hold their private keys; the platform keeps the funds in its name and involves trust in the CEX. Binance has and launched SAFU (Secure Asset Fund for Users), which is an insurance fund created in July 2018 to address security breaches, hacks, or other unforeseen events. This fund demonstrates Binance's commitment to user security and its proactive approach to risk management in the cryptocurrency sector.
The DEX: autonomy and DIY control
Decentralized exchanges like PancakeSwap operate without intermediaries. You trade directly with other users while keeping full control of your assets. Access is freer and there is often greater freedom over the available tokens, including very recent projects. The interface may be less intuitive, network fees are sometimes higher, and the risks of error and scams are very real.
You will not have to create an account, no documents to enter (for now) but also no support, it will happen between you and the blockchain via your wallet. A DEX will give you freedom, but will clearly require more vigilance.
Implicit KYC: on the blockchain, everything is traceable
It is often thought that DEXs guarantee anonymity. In reality, the addresses are pseudonymous, not anonymous. Money flows can be tracked, and regulators or analysis tools like Chainalysis can trace the origin of funds.
Even without doing a conventional KYC on a DEX, your source of funding often comes from a CEX (or a fiat gateway), which implies that a link with your identity exists somewhere.
You can therefore have: A CEX with explicit KYC (and the advantage of simplicity and user support), a DEX with freedom of use, but a public on-chain history that can sooner or later link you to your identity. The conclusion on this subject is that if you have nothing to hide, there is nothing to fear.
Always trade on reliable exchanges with high liquidity to protect yourself from market volatility => Binance
Looking forward to reading your comments and thank you for your support and shares, a symbolic milestone has been reached!
@fred_bnb
