May 18, 2022

DEX vs CEX: Know Where to Trade


Centralized vs decentralized exchanges: where’s the right place for your trades? Read on to find out all about the advantages and disadvantages of each.

There’s a lot to consider when you’re looking for the right crypto platform to start trading on. You’ll no doubt come across centralized and decentralized exchanges on your crypto journey, but which one is right for you? Start by considering your trading level experience, how much control over your funds, privacy, fees, and more.

Want to find out which exchange is best for you? Read on to find out more about what CEXs and DEXs have to offer.

How you trade will depend on your level of trading experience. If you’re new to trading, ease yourself into the process by choosing an easy-to-use exchange, instead of throwing yourself in the deep end straight away.

Some traders prefer platforms with more features and CEXs typically provide more than DEXs. You can do more on a single CEX platform, whereas sometimes with DEXs you have to use multiple platforms depending on your trading needs.

CEXs are known for being accessible with their user-friendly interfaces, making it easy for traders of all levels to use them. Compared to CEXs, DEXs generally have limited features and their interfaces aren't always as user-friendly. However, they do appeal to more advanced traders. Additionally, active CEX platforms reassure new traders that their assets can be exchanged seamlessly at any time, unlike DEXs, which typically have slower transaction speeds.

Although CEXs are more accessible for all trading levels, don’t give up on DEXs yet. DEXs are ideal if you’ve been trading for a while and want to trade on a platform with more advanced features.

Do you want complete control over your funds?

Controlling your funds may be your main concern when you’re trading. Many seasoned traders look for better control over funds and wallets, and DEXs linked to non-custodial wallets deliver this. DEXs link to non-custodial wallets, meaning only you have control over your funds. They give you the power to decide exactly what trade happens and when it happens.

However, if you lose your wallet’s recovery phrase, you’ll lose your crypto. So it’s important to make a secure note to yourself for future reference. CEXs are custodial, meaning that they hold complete control of your crypto. The platform themselves will have full responsibility and control of your assets; this is helpful for beginner traders who like the added help and support.

Interested in privacy, security, and risks?

Some traders are more concerned with privacy, security, and risks. A huge selling point for DEXs is that they allow you to trade anonymously with little to no KYC policies, unlike CEXs, which follow strict KYC procedures that are required for every aspect of trading. DEXs allow you to stay anonymous and trade freely with the security of knowing your personal information is protected.

CEXs are prime targets for hackers as they hold all of their user’s information and funds. This puts users at risk of data breaches. If a CEX is hacked, its users are at risk since the exchange holds all of their funds and personal information. With a DEX, the risk is massively reduced and minimized and traders are in control, as most require little to no personal information to begin trading.

Concerned about fees?

Fees aren’t always straightforward. CEX fees are typically higher, largely because they act as a custodial third party that helps conduct transactions. This contrasts with DEXs which are known for having lower fees and this is one of the reasons why they’re so appealing to traders. However, not all CEXs and DEXs are transparent with their fees. Sometimes you may find out about certain fees only once you’ve completed your transaction.

With bitoftrade, we have 100% transparency with fees. You’ll know what fees you’ll incur before you execute a transaction. Plus, you’re guaranteed upfront fees every time you trade with us.

Trade over 900 tokens with bitoftrade

The variety of tokens available on a DEX is limited in comparison to a CEX. However, bitoftrade is a unique decentralized platform, as we offer over 900 tokens for you to trade with on Polygon and Ethereum networks.

At bitoftrade we offer more features than your regular DEX, combining the benefits of both CEXs and DEXS, as well as being user-friendly! On our platform you can execute swap, limit, and leverage trades.

Additionally, we’re expanding our platform, so look out for our upcoming features and releases: hedging, stop loss, BTRADE token, and more!

To learn more about all things crypto and decentralized, visit our blog where we regularly publish new and interesting content.

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