Centralized or Decentralized Cryptocurrency exchange, which one is your cup of tea?by Isabella Aria Blockchain Technology Blogger
With cryptocurrencies revolutionizing the businesses and economies around the world, having means to access multiple types of cryptos is essential. Services to exchange fiat for cryptos and crypto exchange platforms offer vice versa. But there exist different environments these exchange functions.
Two primary structures of exchange operations are centralized and decentralized exchange operations. Each is unique, with its own benefits and functionality.
What is a Centralized crypto exchange?
Centralized cryptocurrency exchange platforms act as conventional means of exchange services. They are governed by admins or a group of individuals that possess authority over every operation. Security is provided through digital escrow services, thus relieving any responsibility from the users. Centralized exchange platforms make a fair bit of profit by charging a minimal fee from the users for each transaction made. This helps them to continue extending their services for future purchases.
Relieves users from responsibility.
Single authority figure.
Digital escrow services for protection.
A transaction fee is charged.
What is a Decentralized crypto exchange?
Decentralized crypto exchanges are crypto exchange platforms that work on peer-to-peer networks. They are interconnected through a mesh of multiple networks and users, thus enabling self-governance. They promote shared responsibility among users and thereby eliminate the requirement of any intermediaries. They offer reliable and fast-paced transactions through shared servers. Transactions made on decentralized platforms can be tracked and verified by anyone, as the ledgers are publicly accessible and transparent.
Distributed ledgers with public access
Elimination of intermediaries.
High-speed services via shared servers.
Both centralized and decentralized crypto exchanges offer their users a wide variety of features and benefits that cater to different needs. Ultimately, it’s up to the user to comprehend their use-cases and incorporate or engage with one of them.
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Created on Aug 18th 2020 07:59. Viewed 191 times.
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