Somebody holds your money, or you do
Every crypto trade happens in one of two places, and the difference between them is the single most useful thing a beginner can understand.
Centralized exchange
A company holds your funds, runs an order book and matches trades. You get an account, support and a familiar experience. You also get counterparty risk, and the phrase not your keys, not your coins exists because that risk has been realized more than once.
How a CEX worksDecentralized exchange
A smart contract holds liquidity and you trade from your own wallet. No account, no identity check, no company that can fail with your money. You take on approvals, slippage and the fact that mistakes are permanent and nobody can help.
How a DEX worksAnd that is the correct answer
This is not a loyalty test. The two things are good at different jobs, and the sensible setup uses each for what it does well.
| Job | Use | Why |
|---|---|---|
| Turning dollars into crypto | Centralized exchange | It is the only way to move money from a bank into the system |
| Buying a major asset cheaply | Centralized exchange, advanced interface | Deep books and low fees on BTC, ETH and the majors |
| Trading a token that is not listed anywhere | Decentralized exchange | Anyone can create a market, so new tokens appear here first |
| Holding long term | Neither. Your own wallet | An exchange balance is a claim on a company, not an asset you hold |
| Using DeFi, lending or liquidity | Decentralized exchange | It is all onchain and requires a self custody wallet |
| Cashing out to a bank account | Centralized exchange | The regulated on and off ramp is the whole point of a CEX |
The platforms we use
Decentralized
No accounts, no sign up. You connect a wallet and trade from your own address. Our ranked top ten.
Not sure where to trade?
The right answer depends on what you are trying to do and how much you are moving. Twenty minutes usually settles it, and we will show you the fee difference on your actual numbers.