Decentralized Exchange (DEX)

A decentralized exchange (DEX) is a peer-to-peer marketplace that allows users to trade cryptocurrencies directly with one another without the need for a centralized intermediary, such as a traditional exchange. DEXs are powered by smart contracts, which automate the trading process and ensure that transactions are executed securely and transparently on the blockchain. Unlike centralized exchanges (CEXs), where users must deposit funds into the exchange, DEX users retain full control over their assets, minimizing the risk of hacking or fraud. Examples of popular DEX platforms include Uniswap, SushiSwap, and PancakeSwap. While DEXs offer greater privacy and security, they may also face challenges such as lower liquidity and slower transaction speeds compared to their centralized counterparts.