Decentralized exchange (DEX) is a type of online exchange that works in the blockchain network, not a central organ. This means that DEX are decentralized, which means that it does not control their individual unit, and users have full control over their accounts and transactions.
Here’s how a decentralized replacement works:
- Creating a user : The user creates an account on the selected platform.
- Depository funds : The user pays funds to his account, which may be in any cryptocurrency or type of assets served by Dex.
- Adjusting couples : a liquidity pool is created, in which many users pay and pay funds to adapt to the transaction.
- Order book : Exchange keeps a book of orders that lists all available orders for each resource. When the user plays an order for the purchase or sale of assets, their request is matched to match the request of another user in the order book.
- Market financing : The liquidity pool provides users financing commercial assets at favorable prices. When a trader wants to buy an asset, the liquidity supplier provides funds from the pool until trade resolved.
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Dexs offers several benefits in relation to traditional exchanges:
- lower costs : Dex often have lower fees compared to centralized exchanges, because they do not have to pay for intermediaries or maintain the central authority.
- Higher liquidity : DEX can handle more transactions per second because of their decentralized nature and the use of many liquidity suppliers.
- Increased transparency : Dexs usually provide data from books with real -time orders, facilitating users to understand market conditions.
Examples of popular decentralized exchanges include:
- Uniswap
(V2) and
Uniswap (V3) : Two of the most famous Dex that allow users to trade assets directly.
- Sushiswap
: The popular DEX, which supports a wide range of cryptocurrencies, including Ethereum, Binance coins and many others.
- Dao curve : Decentralized replacement (DEX) built on blockchain Ethereum, known for high liquidity and low fees.
When choosing a decentralized exchange, consider factors such as:
- liquidity : Make sure DEX has sufficient liquidity to support your transactions.
- Fees : Understand the fees related to trade on the platform.
- Security : Check the security measures in order to protect the user’s resources.
- User sensations : Look for a friendly interface and quick performance.
Understanding how decentralized exchanges work, you can make conscious decisions, which Dex is best suited for your commercial needs.
