INTRODUCTION

Continuing the series on decentralized and centralized systems, professor @yousafharoonkhan has done a good job explaining and comparing decentralized and centralized exchanges. In this post, I will go ahead to complete the assignment given. Let’s begin...

Write the definition of Decentralized and Centralized Exchange in your own words.

Centralized exchange

A centralized exchange (CEX), is a type of exchange that involves middlemen in the trading process. This type of exchange is comprised of a governing entity that oversees the whole trading process. Nothing, in this case, can be done without central authorization.

Decentralized exchange

A decentralized exchange (DEX), is a type of exchange that connects traders through a direct p2p model. There are no middlemen involved in this type of exchange and the traders have complete control over the trading process.

Explain in your own words the difference between decentralization and centralization exchanges

Some of the differences between centralized and decentralized exchanges are explained below:

1: Centralized exchanges do not give total control to the users due to the presence of a central authority. By this, the funds of users can be stolen by the people in charge.
Decentralized exchanges do not have a central authority so every user is in charge of his funds.

2: Users of decentralized exchanges have to deal with the hassle of private keys and mnemonics. This is not so with centralized exchanges as the exchanges uplift that burden by handling the private keys.

3: Centralized exchanges require users verify their identity before they can carry out transactions. Decentralized exchanges, on the other hand, don’t require any verification from their users.

4: Centralized exchanges impose their own charges on transactions. Decentralized exchange users don’t have to worry about extra charges during transactions.

5: Centralized exchanges can be disturbed by upgrades and system failures. Decentralized exchanges, however, run 24/7 without any disruption in signals.

6: There is high liquidity when it comes to centralized exchanges. Decentralized exchanges have low liquidity.

7: The issue of security is also a major difference between the two. Centralized exchanges can be hacked and have been hacked a lot of times. Decentralized exchanges, however, cannot be hacked and are generally safer.

8: Decentralized exchanges are subjected to regulations. Centralized exchanges are not subjected to regulations as they cannot be controlled.

Write about any 2 best centralised exchanges of 2021 . Why are they best in front of you?

There are a lot of good exchanges out there but for certain reasons I choose Binance and Coinbase as my favorite.

Binance:

Binance is known as the most popular exchange in the world. It is arguable the best exchange out there. Founded in July 2017, Binance is relatively younger than other exchanges like Coinbase and Bitstamp but has managed to top all of them. I like binance for the following reasons:
1: Low trading fees: Binance is most popular for its low trading fees. The fact that its cheaper than most exchanges makes it attractive to traders.

2: User friendly: First time traders can always find their way around the binance user interface.

3: The p2p market: It’s no news that the p2p trading market on binance has been a major game changer. The feature enables traders buy and sell assets without the charges we see in normal trading. Why won’t you love binance?

4: Multiple currencies: A major win for me with binance is the fact that prices of assets can be viewed in a lot of currencies. My country currency, The Naira, is available and it makes it convenient.

Below is a screenshot of my verified binance account:

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Huobi:

Huobi is a major name in the crypto business. Although it is not as popular as Binance, it is still a force to be reckoned with. The exchange was founded in 2013 making it way older than binance. I like this exchange for the following reasons:
1: User friendly: Huobi has a similar interface to binance. The platform is really easy to use and can be navigated by new users.

2; Steem/USDT pair: This probably the main reason I like Huobi. I actually discovered that Huobi had the steem/usdt pair last month and I decided to start using it to tether my steem at peak prices. It has really been helpful since.

3: Experience: Huobi has been in the game for 8 years. That type of experience is unmeasurable. It also means that we can trust the platform in the business.

_{I haven’t verified my Huobi account yet}

Install Metamask, and share step by step screenshot(Practical step by step)

To install Metamask, follow the steps below:

Step 1: Visit the website https://metamask.io

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Step 2: Click on “Download”

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Step 3: Choose the version. I chose chrome. Click on “Install MetaMask for Chrome”.

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Step 4: Click on “Add to Chrome”.

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Step 5: A pop up comes up. Click “Add extension”.

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Step 6: MetaMask is added. Click on “Get started”.

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Step 7: I don’t have a wallet yet so I clicked on “Create a Wallet”.

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Step 8: Read the instructions and click “I Agree”.

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Step 9: Creat and confirm a password. Agree to the terms and click “Create”.

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Step 10: Reveal the backup phrase, save it and click “Next”.

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Step 11: Confirm the backup phrase

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Step 12: That’s it! Click “All Done”.

How to use Uniswap exchange , and Swap/buy or swap/sell any coin (practical step by step )

Step 1: With Uniswap connected to MetaMask, click on “Start swapping”

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Step 2: Choose the coins to swap. I chose two coins I’m quite familiar with. I put in the amount and clicked “Review Swap”.

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Step 3: Wait for the process to complete

_Processing

_{Almost done}

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Step 4: Review the transaction and click “Swap”

CONCLUSION

Decentralized and Centralized exchanges are both widely used by traders around the world. I have completed the assignment tasks given to the best of my abilities.

Special thanks to @yousafharoonkhan