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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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