Hi
friends
All of you knows about the two type s of cryptocurrency exchange ie centralized vs decentralized , now know more about these type of exchanges one by one..
What is a centralized exchange?
The biggest threat to cryptocurrencies is not volatility, as most assume. Instead, it is the fact that 99% of cryptocurrency trade still happens on centralized exchanges.
We all know about some famous centralized exchanges such as these:
BITTREX
COINBASE
BINANCE
etc.
No doubt that since the beginning centralized exchanges made cryptocurrencies like Bitcoin, Ethereum etc accessible to the masses around the world. I also acknowledge the fact that they did a very good job in providing the much needed push and liquidity to crypto markets.
But they also had their fair share of criticisms and failures. Some of which were:
Exchange hacks: More than 30 cryptocurrency exchange hacks in last 9 years with some of them as big as Mt.Gox, BitGrail, Coincheck etc.
Govt ban: The China ban, the Korea ban, and the Russia ban etc.
Poor Support: Anyone who has used a central exchange knows of this problem.
Such bans and hacks happen because when you buy cryptocurrencies on centralized exchanges, like Bittrex or Binance, you don’t actually own them. It is so because these exchanges don’t give you the private keys of your funds. Instead, they just credit appropriate crypto numbers against your order.
Also, there is an additional headache of KYC compliance and identity document submission that one has to do while using such centralized services. And this opens you to another vulnerability of identity theft or your personal identity information getting leaked via centralized exchanges.
Decentralized Exchanges (DEX):
Some decentralized exchanges are-
cryptobridge
etherdelta
bisq
ox
etc..
The biggest benefit to decentralized exchanges, DEXs is the same as with all decentralized applications:
- no central governance (individual nodes can go down but the rest of the network will keep the work with no pause)
- no central point of control and failure (no censorship)
- no single point of regulation which is important for possible shut downs of exchanges by regulators which could lead to loss of funds
- and most importantly DEX empowers users to control their keys, preserves privacy, and introduces far less risk that centralized exchanges.
What works best?
This is what makes Bitcoin such a revolutionary idea. For us to become our own banks is the inevitable future. Having a digital wallet and a decentralized exchange, which we use to buy and sell directly to other people, completely cuts out the use of paying banks for this service.
Centralized exchanges may be more easy to use and relatable to our current way of life, but using a decentralized exchange will get you more used to the concept of a decentralized economy.
source:- differnt online news , diff websites, and google
so friends
please share your views on my post .
thanking you
