Top Cryptocurrency Decentralized Exchanges Ranked | CoinMarketCap

what is a decentralized exchange?

A decentralized exchange, or dex, is a cryptocurrency exchange that operates without a central authority.

how is a decentralized exchange different from a normal cryptocurrency exchange?

Traditional cryptocurrency exchanges operate centrally: the exchange not only provides a place for buyers and sellers to transact, but also passively participates in it as a trusted third-party intermediary.

Reading: Ethereum dex list

Centralized exchanges are traditionally custodial, meaning that after their customers deposit their crypto into an exchange account, the exchange holds those funds for them. the “coins” that are exchanged between buyers and sellers are actually valuable and are tracked internally by an exchange’s centralized authority, only being converted back into real cryptocurrencies when a user decides to withdraw their funds.

In a decentralized exchange, on the other hand, there is no central agent to hold customer funds or keep track of them. instead, they simply serve as a place for a buyer and seller to meet and exchange their cryptocurrencies or crypto tokens. this peer-to-peer trading is fully automated and decentralized on dexs, and the exchange of coins is done immediately and directly.

why do people use decentralized exchanges?

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The first and foremost reason people use decentralized exchanges is that they can maintain full agency over their funds, which in turn allows for a number of advantages. the exchange may not freeze, lose, or manipulate users’ cryptocurrency for any reason, be it politics, incompetence, or malice.

Furthermore, the lack of central storage for customer funds deprives potential hackers of an easy target. Malicious attacks are a major problem for centralized exchanges: In 2019 alone, hackers managed to steal more than $292 million worth of crypto from customers in 12 major attacks.

Another advantage of dexs is its anonymity. Centralized exchanges are operated by companies, which are required by law to acquire industry-appropriate licenses and maintain know-your-customer (KYC) guidelines, forcing their customers to disclose personal data before they can access the exchange. on the contrary, decentralized exchanges allow their users to enjoy the right to privacy and remain completely anonymous.

Lastly, decentralized exchanges’ operations are maintained through a distributed network of nodes, unlike their centralized counterparts, which are hosted on company servers. as a result, the former are less prone to server downtime.

what are the main decentralized exchanges?

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some of the top decentralized exchanges available today include:

idex: One of the largest options available on the market with over $1.5 million in trading volume and over 400 trading pairs. however, it is not a truly decentralized exchange, as it still retains some qualities of traditional centralized exchanges, such as a kyc.bancor policy – ​​one of its unique features is the ability for users to sell and buy cryptocurrencies without a third party trading them. by the platform’s native bnt token. this helps Bancor to increase the liquidity of its markets; low liquidity is often a key bottleneck for decentralized exchanges. binance dex – a decentralized exchange created by binance, which also operates one of the largest centralized exchanges in the crypto market by trading volume.

what are the normal fees for decentralized exchanges?

trading fees vary significantly between different decentralized exchanges, but are generally quite similar to their centralized counterparts and are in the range of 0.1-0.3%.

how secure are decentralized exchanges?

Due to the fact that they do not hold customer funds, dexes are significantly less susceptible to security breaches than centralized exchanges. however, different platforms maintain different degrees of decentralization, which means that they are still vulnerable to different degrees. As an example, in 2018, hackers exploited a vulnerability in Bancor’s wallet that was used to temporarily hold customer funds, making off with $23.5 million in cryptocurrency.

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