In the world of cryptocurrencies, two platforms stand out when it comes to trading: Centralized Brokers (CEX) and Decentralized Brokers (DEX). Both offer cryptocurrency trading services, but they operate in fundamentally different ways, each with its own advantages and disadvantages.
Centralized Brokers (CEX)
CEXs, like Binance, work similarly to the traditional stock market. A central entity operates an order book that matches buyers and sellers, facilitating transactions. To use a CEX, you must create an account and go through an identity verification process. Furthermore, when depositing your assets in a CEX, the broker takes custody of them, which can be seen as an advantage for users who prefer to delegate the security of their assets to a trusted entity.