Centralized exchanges (CEXs) are a type of cryptocurrency exchange that a company owns and operates in a centralized manner.
Examples: Coinbase, Binance.
Advantages of a CEX over a DEX are:
- Speed of transactions (instant)
- No gas fees
- Low trading fees, normally lower than on DEX’s
- Often (after going through AML and KYC procedures) options to deposit or withdraw fiat money using banks and credit cards.
The drawbacks of CEXs over DEXs are:
- You need to doxx yourself in order to withdraw your assets to your own wallet.
- Not your keys, not your coins
- Can have financial, regulatory or technical problems, causing loss (see also rug).
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