Cryptocurrency can simply be accumulated and stored, waiting for the price to rise. At first glance, this is the easiest and most effective way to increase capital. In practice, everything is much more complicated. The rate of price change is unpredictable, most likely you will have to wait a long time for profit.
Given the extreme volatility of the cryptocurrency market, it becomes quite obvious that you cannot do without asset diversification and the occasional use of safe-haven assets. In addition, long-term investment can be supplemented with active trading and thereby increase profits. One way or another, but the question of a platform for the exchange of cryptocurrencies is relevant for everyone.
Where to buy, sell and exchange cryptocurrency?
Numerous cryptocurrency exchanges and fast crypto exchangers operate on the Internet. Cryptocurrency exchanges are divided into centralized (CEX) and decentralized (DEX). Exchangers are classified by the presence of storage. Some sites have it, some don’t.
What are the different types of marketplaces
First of all, CEX is managed centrally. Accordingly, the same rules are adopted here as in more familiar financial institutions.
Access to the technical capabilities of CEX opens after registering an account. In addition, many exchanges will require you to go through the KYC procedure, that is, at least provide an identity card. The CEX part recommends that new users go through the KYC, but does not insist on it. As long as we are talking about small trading volumes or operations like exchanging 0.042 ETH to USD, you can save incognito. But you most likely will not be able to make large transactions.
To date, CEXs have the greatest influence on the formation of market prices. Centralized platforms provide an opportunity to buy and sell digital coins for fiat currency, exchange cryptocurrencies, join mining pools. Staking and crypto loans are already available on the most popular CEXs. Functionally, trading terminals almost do not differ from traditional stock and currency exchanges.
DEXs are based on the blockchain and do not have a central authority. To trade on the DEX, registration is not required, you just need to connect your cryptocurrency wallet to the platform. There are no formal restrictions on decentralized sites, but their technical capabilities are still noticeably more modest. This may be due to blockchain incompatibility or the current lack of liquidity. Also, they do not support fiat currencies and even 0.022 ETH to USD cannot be converted.
The principles of operation of DEX are quite different from the classical ones. Instead of the usual order book, many sites use an automatic market maker system.
The functionality of such services is extremely simplified. There may not be any tools for market analysis at all. They are focused on the speed of service at current market prices. Exchangers are ideal for buying coins for long-term investment or quick cashout of digital assets. However, they are not adapted for intraday trading. Registration on such platforms is usually not required, and the possible presence and nature of restrictions can be found in the description of a particular platform.
It is one of the largest operating DEXs. The platform supports the exchange of Ethereum and 65 ERC-20 tokens. Cryptocurrency transactions are conducted through user-created liquidity pools. Accordingly, the number of exchange pairs sometimes changes. There is no purchase of cryptocurrency for fiat and no P2P platform. The possibilities of passive income are limited, users are rewarded only for the supply of liquidity to the pool.
SushiSwap is somewhat younger than its main competitors and surpasses them in terms of technical capabilities. First of all, the site supports 15 blockchains. In addition to exchange operations and passive income on the supply of liquidity, pharming and crypto lending are available to clients.
Fast growing instant cryptocurrency exchange service. In addition to exchanging 700+ digital coins, users can buy and sell cryptocurrencies for fiat currencies.