Centralized VS Decentralized Exchanges: Pros and Cons The wor | Scopuly News

Centralized VS Decentralized Exchanges: Pros and Cons

The world of digital currencies is unimaginable without exchange platforms, where exchange transactions worth more than $100 billion are made daily. And this is without taking into account derivatives

Today, there are over 300 exchanges on the market, which can be divided into 2 types of CEX and DEX:

Centralized Exchanges (CEX)
CEX is an exchange managed from a single center. Control over exchange operations, security of funds, and maintenance lies on the shoulders of the exchange administration.

CEX examples: Binance, Coinbase, Kraken, etc.

Advantages:
Ability to work with fiat
The presence of extensive functionality for trading
Liquidity

Flaws:
No access to private keys
High risk of security and hacking
Price manipulation (bots and other algorithms)
Verification

When you store funds on the CEX exchange, they become not yours until you withdraw them to your wallet.

Decentralized Exchanges (DEX)
DEX is a decentralized platform based on distributed ledger technology and operates using smart contracts.

DEX Examples: Uniswap, SushiSwap, Balancer, Scopuly, etc.

Advantages:
Anonymity (no personal data)
Private keys in the hands of the owner
Ability to quickly add coins for exchange
Issue of tokens (tokenization of assets)
Lack of KYC (identity verification)
No one can block your account

Flaws:
Less extensive set of trading features
Liquidity is lower than on CEX
Difficulty for beginners compared to CEX

Read more:
https://scopulyplatform.medium.com/centralzed-vs-decentralized-exchanges-89c4bc96e975