Cryptocurrency exchanges are one of the main tools for buying and selling digital assets. They are very convenient, as they allow you to make transactions online, and even without verification.

There are a large number of cryptocurrency exchanges, so it is difficult to choose the right one among them without understanding the terms of trade. Typically, platforms are compared in terms of trading volume, as well as the opportunities provided to users to make secure transactions.

Centralized and decentralized exchanges for trading

Cryptocurrency trading platforms of a centralized type are abbreviated as CEX (Centralized Exchange). They differ from decentralized (DEX – Decentralized Exchange), since control over the functionality of the site and the operations performed is in the hands of the central management body (management company). As a result, transactions are made between users through the mediation of a third party.

Examples of CEX exchanges:

  • Binance;
  • Coinbase;
  • EXMO.

The advantages of centralized sites include:

  • the ability to make transactions with digital assets, as well as with fiat currencies;
  • a wide range of functionality;
  • even beginners do not have questions: how to replenish the balance, as well as withdraw funds;
  • high liquidity.

Disadvantages of CEX exchanges:

  • no access to private keys;
  • users are required to pass verification;
  • increased risk of account hacking compared to DEX exchanges.

On DEX platforms, all transactions between the parties to transactions are made directly using blockchain technology (through smart contracts). Such exchanges have the following advantages:

  • transactions are made anonymously;
  • only their owners have access to the private key and digital assets;
  • wider choice of coins for trading;
  • there is no risk of blocking the account by the decision of the administration (as it can happen on CEX).

As a result, the disadvantages of DEX include:

  • reduced liquidity compared to CEX;
  • there is no possibility to trade fiat currencies.

Important characteristics of an exchange for trading cryptocurrency

 

The amount of the commission is the amount withheld by the site for transactions made by users. The smaller it is, the more profitable it is to trade. The lowest commissions are offered by:

  • Bitmex – 0.025%;
  • Binance – 0.075%
  • KuCoin – 0.075%;
  • Bitfinex – 0.1%.

Trading volume – the higher it is, the more confidence in the site.

Security: young sites are more vulnerable to hacking, as they do not have the same financial opportunities to organize and test protection as competitors with billions of dollars in turnover.

Availability: For a novice trader, the following nuances also matter:

  • clear interface (for example, Russified), since it is immediately clear how to create an account on the exchange;
  • the presence of a mobile application, as well as a version for a PC;
  • availability of a demo account and bonuses for registration.

Experienced traders, in order to diversify, prefer to place digital assets on several platforms: CEX, as well as DEX. As a result, preference is given to sites with the most developed functionality. This is why beginners are more likely to choose centralized exchanges for trading.