Why Are DEXs Attractive?

Advantages of DEXs

Firstly, anonymity. There is no so-called KYC procedure, no registration. All the users need is a public address. Without offering any personal information, you can start trading on a DEX.

Secondly, better privacy. Users don’t have control over their private keys on a CEX while they can fully control their funds in the world of DEXs. And transparency, since all the transactions are secured by the smart contracts, everything is logged, traceable and transparent.  

Drawbacks of DEXs

Of course, it has disadvantages, such as high technical barriers to join. After browsing multiple DEXs, you can tell most platforms are not very beginner-friendly, offering a frustrating user experience and on top of that, providing little customer support. 

No fiat currency exchange is another major drawback for many users. DEXs usually have lower liquidity than CEXs and transactions take longer to be validated since it depends on the network’s nodes. DEXs also maintain the same scalability problems. 

CEXs Eyeing DEXs

As more people are interested in DeFi, the popularity of DEXs surely increases. CEXs is the central system to oversee the whole trading process which in fact contradicts what a world of blockchain has been pictured and interpreted. Though CEXs ensures greater market depth and faster transactions. And of course, CEXs seem to be easier to win the authorities' hearts compared to DEXs.

However, DEXs work in line with Bitcoin creator Satoshi Nakamoto’s belief, also the faith of crypto lovers’. Seeing the higher needs for DEXs, the largest CEX, Binance, launched its own DEX in 2019. One of the rising CEX FAMEEX as another example believes DEXs may gradually take over the market of trading platforms and will become a mainstream choice in the near future.