Just like stock market, crypto exchange allow users to do a peer-to-peer transaction, without any interference from a third party. The only difference – Cryptocurrency exchanges are platforms that initiate the trading of digital coins.
They are a relatively new concept, however, since a lot of investors are taking interest in cryptocurrencies, it is important to decode the types of crypto exchanges as well.
Decentralised crypto exchanges are one such platform.
How do you define decentralised crypto exchanges (DEXs)?
It operates in a decentralised manner, without any interference from a third party. Decentralised cryptocurrency exchanges allow the users to use peer-to-peer (P2P) transactions. This process relies on automated smart contracts.
Advantages
#1 : DEXs must be your go-to option if you want complete privacy since they are anonymous. They never ask for (KYC) details, instead work on the basis of anonymity.
#2 : They work on the principles of automation and self-regulation that make them cheaper comparatively. DEXs would help you cut down all the additional costs.
#3 :Decentralised exchange makes the hacking risk almost next to impossible. You do not have to exchange assets to a third party in between which makes it less prone to hacking.
#4 :You have full control over your wallets and funds. To carry out transactions, it doesn’t ask you to transfer funds to a wallet or any trading accounts. After all, having an e-wallet, just like in the case of a centralised exchange platform, increases risks.
#5 :Unlike centralised exchanges, decentralised crypto exchanges don’t provide friendly features. DEXs can be full of complexities.