Decentralized exchanges are exchanges that do not rely on a third-party service to hold client funds. Instead, operations are performed directly between users (peer to peer).

This is achieved through an automated process, called Smart Contracts (smart contracts). The absence of third parties makes the Decentralized Exchange (DEX) offer greater privacy and security than traditional exchanges.

A Decentralized Exchange (DEX) is a cryptocurrency exchange that works without the intervention of third parties. For those who have not yet worked with cryptocurrencies and do not know it, the purchase and sale of digital assets is usually done through centralized exchange platforms. And it requires the transfer of funds, even for a moment.

This can be avoided by using a DEX, which uses smart contracts on the Blockchain to make transfers and trades. However, DEXs are still not as popular as centralized ones.

This is because decentralized networks are difficult for newcomers to understand. What brings, as a consequence, that more accessible options such as Coinbase, Binance, Crypto.com are used. 

In short, a decentralized exchange allows you to trade without the involvement of third parties, albeit at the cost of less liquidity and higher transaction fees.

MzeDex Team