#CEXvsDEX101 🔒 Security & Control
• CEXs
• Custodial wallets with insurance cover (often up to a limit)
• 24/7 customer support and recovery options
• Established compliance & KYC procedures
• You don’t truly “own” your private keys
• Risk of exchange hack or mismanagement
• DEXs
• You keep full custody of your assets (no middleman)
• Non‑custodial, pseudonymous trading
• Often built on transparent smart contracts
• Smart contract risk (bugs, exploits)
• No recourse if you lose your seed phrase or make a mistake
⚡ User Experience & Liquidity
• CEXs
• Ultra‑fast order matching, deep order books, margin/leverage options
• High liquidity on major pairs—ideal for heavy trading and tight spreads
• DEXs
• Impermanent loss risk if you’re providing liquidity
• Slippage on low‑volume pools, but rising with more DeFi adoption
• Gas fees can spike on congested networks (Ethereum, BSC, etc.)
🤔 When to Use Which?
• Use a CEX if you need:
• High‑speed execution for day trading or arbitrage
• Access to advanced order types (OCO, trailing stop, margin)
• Fiat on‑ramps or stablecoin conversions without wrapping
• Use a DEX if you want:
• To swap emerging tokens that aren’t listed on CEXs
• Full control of your assets & on‑chain privacy
• To participate in yield farming or liquidity mining directly
🎯 My Preference & Strategy
I personally split my assets:
1. Long‑term holdings stay in my self‑custody wallet and I use DEXs when rolling into new DeFi projects.
2. Active trading capital lives on a top‑tier CEX for quick trades, low slippage, and leverage opportunities.
💡 Tips for First‑Time DEX Users
1. Start Small: Test with a tiny amount to get familiar with gas fees and slippage.
2. Check Smart‑Contract Audits: Only use well‑audited platforms (Uniswap, PancakeSwap, etc.).
3.Use a Hardware Wallet or WalletConnect: Keep your seed phrase offline.
4.Monitor Gas Price
5. Double‑check contract addresses on official sources before swapping.