Decentralized exchange (Dex) is a kind of internet exchange that acts in the blockchain network and not on the central government. This means that the Dex is decentralized, which means that there is no entity that controls them, and users have complete control over their accounts and transactions.
This is how a decentralized exchange works:
- User creation : The user creates an account on the platform of his choice.
- Position of the funds : The user inserts funds for their own account.
- Suitable couples : A liquidity pool is created in which several users insert and take off to meet the transactions.
- Order book : Exchange holds a book book in which all available orders are cited for each property. If the user ordered the purchase or sale of the property, the request coincides with the request to match another user in the order book.
- Financing markets : Poolpool offers users trading with wealth traffic at good prices. If a dealer wants to buy real estate, the liquidity provider delivers funds from the pool until the business is solved.
- IPO fees
: Börse collects compensation from craft that is assigned among all parties involved in the transaction.
Dexs offers several advantages over traditional exchange:
- Lower costs
: Dexs often have lower fees compared to centralized stock exchanges, since they do not have to pay mediators or maintain the central government.
- More liquidity : Dexs can cope with more craft per second due to its decentralized nature and the use of several liquidity providers.
- Increased transparency : Dexs usually supply real time information for the time so that users can understand the market conditions.
Examples of popular decentralized stock exchanges are:
- Uniswap (V2) and
Uniswap (V3) : Two most famous Dexs that enable users direct trade in assets.
- Sushiswap : Popular Dex, which supports a wide range of Cripto currency, including Ethereum, Binance Coin and more.
- The curve given : A decentralized exchange (Dex) based on Ethereum Blockchain, which is known for high liquidity and low fees.
If you choose a decentralized exchange, take into account factors such as:
- Liquidity : Make sure that Dex has enough liquidity to support your business.
- Fees : Understand the fees related to trading on the platform.
- Safety : Check security measures to protect user assets.
- User experience : Search for the user interface and the speed of the execution speed.
If you recognize how decentralized exchange work, you can make sound decisions about which Dex is best suited for your trade needs.
