Intro
IntroAs a moderator of the Tron Fan Club community, I regularly write various tutorials on crypto blockchain and Tron related matters. The main purpose of these tutorials is to make our new users aware of these topics. In continuation of that I am writing tutorials on trading and finance. Hope you can easily learn some details of trading and finance through this tutorial series.
Decentralized Exchange (DEX) has been explained in previous couple of posts. As this is a sequential series of tutorials now today let’s discuss on the feature and some examples of DEX. Decentralized Exchange is a platform that allows individuals to buy, sell, and trade various cryptocurrencies directly with each other. Here there is no need of a centralized intermediary.
Features:
- The nature of this exchange is decentralized. This is the key feature of it. It will be operated on a decentralized network. Normally blockchain network is preferred because we know that the blockchain technology will allow users to trade digital assets directly with each other. So, there is no central authority. It will be automatic based on certain conditions to be meet.
- DEXs allow users to control their own private keys and digital assets. Individual and auto generated private key is reducing the risk of theft or loss due to hacks. As these keys are not stored to anyone so only the account assets owners can protect wallet by keeping the private key secured. In centralized system, it is stored to the central database. In that case, there is a possibility of hacking of central server. So, risk will be double in centralized system. But here, it’s simple and less risky.
- Decentralized exchanges normally do not collect or store personal data. Privacy protection is very important issue in this digital world. Users would like to maintain their strong privacy. So it is an attractive option for users who value privacy and are concerned about their data being misused or hacked.
- All trades are recorded on the blockchain and can be publicly audited. So, the whole system is transparent. This feature is promoting fairness and trust in the market and with that making it easier for users to verify the authenticity of trades and transactions.
Examples:
Uniswap (Ethereum blockchain)
Binance DEX (Binance Chain blockchain)
0x (Ethereum blockchain)
This is an interesting post you have written on the basis of crypto trading.
You have given us the features and examples of centralized exchanges
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