Blockchain

With the invention of Blockchain Technology, it comes with their positive and negative aspects So here we discuss what we can do and how decentralized Crypto exchanges work and will be adopted in the near future.

Quick start with the application of blockchain Crypto which is the most popular and earlier use case of blockchain technology. Crypto created with the vision of decentralization and transparent safe and secure global payment system which appear with the name of an idea called Bitcoin.

After introduction and adoption of the crypto, the community started using crypto and their applications day by day and currencies come with exchange feature where everyone can exchange their currency with other pairs where they will use different exchanges in crypto terms now popularly called cryptocurrency exchanges currently bitfinex, huobi, binance etc.

Centralized and Decentralized Crypto Exchanges

When we talk about Blockchain and Crypto Exchanges then Definitely the vision glow in our minds distributed control or single control and manipulation of rights.

Centralized Crypto Exchanges

We all know who are interested and already involved in crypto earlier and trading Crypto pairs on different Exchanges So how centralized Exchanges Work and what risks are attached with these Exchanges?

Centralized Exchanges mean to say Your funds, account details where you enter all the other things are in someone’s control. when your funds and financial matters are on risk, very important for you to get updated about that Platform of crypto Exchange.

On Crypto Exchanges things change and happen according to their intentions of admins (Exchange owners)

Why centralized Crypto Exchanges are no More Worthfull and Use full?

Because blockchain Come with their Core vision Which is Decentralization and Distributed community-based local governance where everyone has equal status and voting power. On centralized Exchanges, User funds and rights can be manipulated and on the situation maybe government laws and local regulatory authorities want to know about users details and financial transactions privately.

On Centralized Exchanges, Users Wallets are in administrations control because they own the wallet private keys.

Where users can be controlled through different policies, terms, and condition for the sake of currency exchanges.

Because of Exchanges centralized servers and centralized governance, the rules of the exchange and regulations easily manipulated by authorities.

but Blockchain solves this problem with the feature of Decentralization and distributed node technology. Introducing DEX Decentralized Exchanges

Positive aspects:

High Market liquidity and users base.

More users Support if you forgot Your accounts password you can recover through the forgot password feature and customer support

User-Friendly Design and fast speed of processing of order because of Centralization volume and order filled in few minutes

More features for trading like API and stop loss and price limit For convenience in crypto trading.

fiat currency trading and other pairs for fiat withdrawal

Negative aspects:

No control on funds and risk of security and exchange server down and hacks in exchange backend (check out the history of Crypto Exchanges Hacks and funds loss)

Because of centralization the exchange owners and admins can transfer the user’s funds and impose higher trading fee has they decided for their profit for their personal growth and manipulate users rights.

wallet private keys are own by exchange owner it’s the major concern

Decentralized Crypto Exchanges Dex

Blockchain focuses on decentralization transparent and distributed control on any system of community when it’s implementing on Cryptocurrency Exchanges then you no need to complete your KYC details no limit of daily, weekly and monthly trading, withdrawal limits plus no imposing of high trading and withdrawal fees.

You Have open different effective and alternative options to join or switch any exchange with your freedom no risks of Exchange hacks server down problem or failure of the website where the community is strong and blockchain is solid so nodes are running globally no risks of authorities to stop it and manipulate it.

On Decentralized Exchanges wallets funds are totally control and own by users because they own their wallets passwords and backup recovery keys as well as private keys so users are totally responsible for their wallets security and responsibility of the fund’s safety.

Positive aspects:

Funds are safely secure on users own wallets where their private keys are own by individual users as well as creators who had created.

Because of decentralization and distributed governance, nobody controls and manipulate the price action.

No limits of geographical areas on the global world everyone from everywhere can access and fulfill their desire from the exchange.

much more benefits are attached with dex’s decentralized exchanges with more adoption

No Imposing fee such as trading and withdrawal fees in term of different policies

Negative aspects:

Low market liquidity because of low users volume

No fiat and local currencies withdrawal support for trading fiat currencies

Because of fresh technology less awareness, nobody knows very well about decentralization and dex’s wants to switch from centralized to decentralized exchanges (basically this is a temporary early concern it changes when adoption increases)

Because of less awareness and visitors low volume of trading pairs, your order will be placed when your desired order will match with a taker because on decentralized exchanges your order placed through maker and taker (read more below about it).

funds are totally controlled by users with their private keys so nobody like exchange owner responsible for funds security. for beginners and inexperienced users are not really interactive and friendly with decentralized exchanges so because of this reason major funds losses maybe happens on decentralized exchanges because of technical difficulties.

small mistake and funds will be stolen from user wallets because of less awareness and user guidance, therefore, DEX’s are not yet most suggestible.

How Decentralized Exchanges DeX’s work?

Here currently and newly created 2019 DEX’s Popular list below

Binance Dex, IDEX, EtherDelta, Bisq, Waves DEX, switcheo, Airswap, radar relay, Kyber Network, etc.

All the Above Mention Exchanges are Also listed on Coinmarketcap For Now and Popular in Market. Before Visiting Any Exchange or Creating or Connecting Your Wallet Make sure their Reviews in Market is Good To Use it.

How DEX work

On Decentralized Exchanges, a smart contract run on the blockchain and all the exchanging rules and fees is set in a smart contract where nobody can change them all the rules and settings are same for everyone on it.

As You See in Above Mentioned DEX Demonstration as Easy to Understand the Simplest Working Process.

On Decentralized Exchanges when Someone needs 1BTC then Exactly Others Also Should Sell 1BTC For Buyer to Complete the Order if The Exact order Match is Not Available then You can not Complete Your Order.

A maker is a person who Places the Order on DEX To Required need to Accordingly for takers who take’s the order and complete the request and sell the amount to other as usual vice versa.

But Some Exchanges using Semi Decentralization to attach Centralized Exchanges to complete the order quickly for speedy transactions.

All the order placement and completion rules are set in a smart contract so therefore no manipulation can’t happen by someone or break the rules. An atomic swap is used by Exchanges to complete an order on the off-chain away from the main blockchain without centralized authority involve no funds access are involved in it.

When a person needs one bitcoin and they requested in a smart contract which set by rules the smart contract show to maker order, then when the taker wants to complete they send the required amount to receive then the smart contract rules are match and all the needs full fill order filled and completed.

So For Using Any DEX Just, You Need to do is go is URL address and create your wallet some exchanges also import wallet feature where can import login through details but be careful. After Visiting create a wallet or connect with Metamask if you are using Extension.\

Watch the below video in-depth and detailed visualizing content where you will learn and watchfully in crypto terms and discussion on decentralized cryptocurrency exchanges.

Future Adoption

As all know the blockchain technology come with is core vision decentralization and distributed control or governance where everyone has voting and equal rights power. So this adoption Centralized Exchanges must be not useful for future if government against the Crypto and want to ban then ban the URL address as Exchanges follow the rules they also not to support the country for their user’s registration as you see on several exchanges because of censorship.

Solving this major problem among Crypto community and freedom of crypto adoption and freedom of crypto trading the decentralized exchanges are the option to use in future to stay away from the unfair tax system and imposing useless rules by regulatory authorities. but we hope blockchain integrate with the existing system and digital payment system for globalization and freedom of sending of payments across the world.

What’re your views on this decentralization and blockchain technology tell us about or also mention the feedback about the above article for amendments if things are missing or somethings not really match with reality.