Decentralized Exchanges Vs Centralized Exchanges
Decentralized Exchange Websites: An Overview
The decentralized exchange is an innovative exchange model in cryptocurrency industry which results in high security and instant trading of your digital assets. Exchange websites which perform decentralized exchanges are called as decentralized exchange websites. There is a solid reason for decentralized exchanges to emerge online, Yes. In the past three years (2015-2018), there were around $100bln were stolen from unsecured centralized exchange websites.
Why Decentralized exchanges?
Because centralized exchanges will store everything on a "Honey Pot" called central cloud server, which includes your digital assets, and the private key of your wallet. This encourages anonymous users to perform malicious activities on an exchange website, and results in a huge loss.
To prevent this issue entire cryptocurrency and blockchain industry were invented a new exchange process known as decentralized exchanges. To be clear, a decentralized exchange will never store any of your details including your digital assets, private keys or anything.
So you can " Trade on the GO".
Note To Remember Forever :
We are not saying that all the centralized exchanges are unsecured and unworthy to trade your digital assets. But some centralized exchanges are careless about their security and traders assets. So this becomes the reason for unexpected attacks and trader to lose their hope on centralized exchanges. Being an owner of a centralized exchange website if you integrate and upgrade security features often, your website will be safe from this kind of issues.
Decentralized exchanges are not an alternative to prevent hacking and other issues happen on centralized exchanges. Instead, it is an upgraded exchange business model which ease all your trading activities.
Difference between centralized and decentralized exchanges
Centralized exchanges : (CEX)
Exchanges made under the concept of "Random Trade Match algorithm", where the algorithm matches buy order/sell order and execute trades.
1. Easy to use and suitable for beginners
2. High Liquidity
3. Mulitple currency pairing
1.Compulsory KYC Submission from minimum to maximum amount of trading.
2. Admin has full access to control your funds and the entire funds on the website.
3. Need to share your private key, and it will be stored on a third party server.
Decentralized Exchanges : (DEX)
Exchanges made under "smart contract" concept.
1. Speed and Low fee
2. Never require your KYC details
3. Users have full access to control digital assets.
4. Never store traders assets and private key in a central server.
5. No server downtime
1. Limited cryptocurrency pairing ( Current DEX website allow trading only with ETH and certain cryptos)
2. Not easy to use for beginners
3. Low Liquitidy.
Check out the Importance of Decentralized exchange websites here.
To begin an innovative exchange business start your decentralized exchange website from scratch with bitdeal.
Cryptocurrency Decentralized Exchange Script
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