Which do you prefer, CEXs or DEXs?

[KryptoBull]

An important part of the investment journey in the crypto market is buying and selling crypto assets. At that time, investors will have two main options: using CEXs or DEXs. While CEX is operated by a company, DEX is operated without permission through smart contracts on the blockchain^[1]. I have used both and am quite satisfied with the service they both provide.

• CEXs are more user-friendly, do not require users to store private keys or use the correct Dapps in a certain blockchain ecosystem, and do not need to store native coins to pay transaction fees. All users need to do is create an account, perform KYC, deposit funds and start trading with tons of tokens and excellent liquidity. Trading fees on CEXs are about 0.1%-0.2%, very low and stable, meaning when I trade assets worth 1000 USD, I only need to pay 1-2 USD in fees. I also love Earning and Staking on CEXs because it's so simple!
  CEXs's biggest risk is probably related to its legality and high dependence on the company behind it. We will never forget the Mt.Gox hack in 2014^[2] and the fall of FTX in 2022^[3]. The same thing will likely happen to any active CEX.
• DEXs require users to have a little knowledge of blockchain: own an account/address, self-store private keys, know the token's blockchain, need a native coin to pay transaction fees, use the right Dapps and know wallet connection. The limited number of tokens and liquidity on DEXs are often issues that concern me, and high blockchain transaction fees and DEXs fees also discourage me from using DEXs. For example in 2021, a Swap on UniSwap can cost about 100 USD, which is too much when I want to buy 50 USD in SHIB tokens.
  Some new tokens also pose risks, if users forget to revoke after swapping. I have never added LP on DEXs because I was afraid that my assets would disappear overnight because the DEX protocol was attacked. This happened to many users in the hack-season of 2021^[4].

Many people like to use CEXs and many people like to use DEXs, I believe that they are both important for the development of the crypto market: they serve different services, serve different users. They help make the crypto market accessible to as many users as possible, without any barriers. This is something that traditional markets cannot yet have!

I would like to know your opinion on CEXs and DEXs:

• Which do you prefer, CEXs or DEXs, and why?
• For CEX users: Does KYC concerns impact your choice of CEXs?
• For DEX users: Do you believe DEXs have the potential to completely replace CEXs in the future?

References:
[1] Centralized Exchange (CEX) vs. Decentralized Exchange (DEX): What’s the Difference?
[2] Mt Gox Hack Explained
[3] FTX collapse: The crypto industry’s Lehman Brothers moment
[4] The 10 Biggest DeFi Hacks of 2021: A Recap
Thank @Mr. Magkaisa for suggesting idea for this topic
Note:

• My opinion was posted first in that topic, on Bitcointalk
• I leave the source link to avoid plagiarism accusation.
• I excluded/ included minor things from an original thread ^{if necessary}.

[TomPluz]

I would assume that just like ALL of us here in this forum, I am using both types of crypto platforms - the DEXs and the CEXs. Certainly, both got many good advantages as well as disadvantages but so far with my experience with them every transaction comes easy, fast and quite satisfactory.

1. Which do you prefer, CEXs or DEXs, and why?
I don't really have preference as I am using both of these types of exchanges. Now, there are times when the exchange available is only in a CEX so there is no choice but to use one but in case things can be done in DEX then I would exchange the coin and token in there because DEX is a lot more convenient and fast since there is no more need to transfer the asset as transactions can be done seamlessly. Right now, I am a heavy user of TrustWallet and we know that many DEXs are already integrated into its ecosystem.

2. For CEX users: Does KYC concerns impact your choice of CEXs?
As I said, if I can do things in a DEX I would prefer it there but since sometimes we can't have our cake and eat it too there are instances when using CEX can be necessary. Yes, KYC can sometimes be a hassle and we are always afraid of data mishandling but nevertheless if there is a need to do it then go. Good thing to know that many big CEXs are allowing accounts to do business even without KYC up to a certain amount of transactions.

3. For DEX users: Do you believe DEXs have the potential to completely replace CEXs in the future?
I would say that DEX got a big potential for more growth but replacing CEXs entirely may seem to me a little bit far-pitched. As we are witnessing right now, many CEXs are enjoying good business, a big testament that many people do trust them and would continue doing business with them into the future. Plus, we know that governments are working with CEX and not with DEXs so once many governments can be flexing their muscles business with DEXs may also have limitations.

[0t3p0t]

Which do you prefer, CEXs or DEXs, and why?

I prefer centralized exchange because of liquidity and support of coins. It also offers p2p trading with local fiat currency.

For CEX users: Does KYC concerns impact your choice of CEXs?

No, it doesn't matter to me though risky to share our personal information as it can be compromised anytime if there is data breach or they can even sell it.

For DEX users: Do you believe DEXs have the potential to completely replace CEXs in the future?

For me no, given that it has limited features on it and lack of coin support and liquidity it will still remain what it is right now but this also depends on improvements in the future.

[MrSpasybo]

Many people like to use CEXs and many people like to use DEXs, I believe that they are both important for the development of the crypto market: they serve different services, serve different users. They help make the crypto market accessible to as many users as possible, without any barriers. This is something that traditional markets cannot yet have!

I would like to know your opinion on CEXs and DEXs:

• Which do you prefer, CEXs or DEXs, and why?
• For CEX users: Does KYC concerns impact your choice of CEXs?
• For DEX users: Do you believe DEXs have the potential to completely replace CEXs in the future?

1. I am using both CEXs (Binance, KuCoin, GateIO) and DEXs (UniSwap & PancakSwap). CEXs are used to trade already listed tokens, while DEXs are used to trade new tokens, often as rewards in bounty campaigns.

2. KYC is not a big deal, it is already a common requirement for CEXs users. This helps CEXs comply with KYC/AML regulations and be allowed to operate.

3. I think DEXs will be used more and more when users want to self-custody assets. However, DEXs will not be able to replace CEXs because many users still want to access the market in the simplest way, without needing to learn too much about blockchain or how to preserve seed phrases themselves.

[electronicash]

the thread in the BTT is a poll but not this one.
users of DEX does have more experience in crypto trading and it needs more technical knowledge to use DEX unlike the CEX where you see the orderbook. i know there are dex that are also orderbook type but that's less use because they know the price difference compare to the CEX.

3. I think DEXs will be used more and more when users want to self-custody assets. However, DEXs will not be able to replace CEXs because many users still want to access the market in the simplest way, without needing to learn too much about blockchain or how to preserve seed phrases themselves.

sure thing. CEX is much simpler to simple people who only wants to trade not minding the KYC. compare to the number of people who are concern about their privacy, the people who don't care about it are probably 95% of the population.

[Gyrgen]

I would be happy to use dexes if they had the same transaction fees as on centralized ones. Well, in addition, there is the problem of providing liquidity on dexes. In general, it is optimal for it to be centralized and without KYC, but unfortunately this is already unlikely.

[Yamane_Keto]

The term DEXs is associated either with services that do not require identity verification or those that make the user link his wallet, but although they claim that they are decentralized platforms, we hear that some of them have been hacked and this is due to the incorrect definition of the word decentralized.

These DEXs are managed by bridges. These bridges close native coins and give you tokens of equal value, and here they are the central point in these projects, where the smart contract can be hacked, the process of closing native coins or printing more tokens, which leads to not having enough tokens when you want to get your money back.

The burning and minting processes can be centralized, making the number of real DEXs limited to only P2P DEXs like Bisq or sidechains and Layer 2 solutions.

[DaNNy001]

Which do you prefer, CEXs or DEXs, and why?

I prefer centralized exchange because of liquidity and support of coins. It also offers p2p trading with local fiat currency.

Before now I was in the same opinion with you but with how things have changed with CEX and my country laws, I really don't think that CEX is more preferable for me because that part of P2P trading on CEX are being blocked and removed and the reason to all this is because of the fact the government can attack them as they know the individuals that run this platform

[KryptoBull]

1. I am using both CEXs (Binance, KuCoin, GateIO) and DEXs (UniSwap & PancakSwap). CEXs are used to trade already listed tokens, while DEXs are used to trade new tokens, often as rewards in bounty campaigns.

2. KYC is not a big deal, it is already a common requirement for CEXs users. This helps CEXs comply with KYC/AML regulations and be allowed to operate.

3. I think DEXs will be used more and more when users want to self-custody assets. However, DEXs will not be able to replace CEXs because many users still want to access the market in the simplest way, without needing to learn too much about blockchain or how to preserve seed phrases themselves.

New investors will not choose DEXs because they are often worried that they will not be able to preserve their private keys well and lose access to the crypto assets in their accounts. CEXs are clearly a friendlier and more familiar option: easy to buy and sell right on smartphones via an application, can sell tokens for cash quickly. Most users are willing to perform KYC to experience the service in a simpler and more convenient way. They do not really understand blockchain technology and do not value decentralization.

the thread in the BTT is a poll but not this one.
users of DEX does have more experience in crypto trading and it needs more technical knowledge to use DEX unlike the CEX where you see the orderbook. i know there are dex that are also orderbook type but that's less use because they know the price difference compare to the CEX.

I have added a pool, hoping to receive votes from many members in the forum.
When I come to the crypto market, I also like to use CEXs. Even now DEXs are better, have more services, and are more user-friendly, but I rarely use new features. I just use Pancake to sswap some tokens to BNB and deposit BNB to CEXs.

I would be happy to use dexes if they had the same transaction fees as on centralized ones. Well, in addition, there is the problem of providing liquidity on dexes. In general, it is optimal for it to be centralized and without KYC, but unfortunately this is already unlikely.

Many DEXs charge quite low fees, and transaction fees are no longer a concern on fast and extremely cheap networks like Solana, Fantom, Arbitrum... However, I feel that users still prefer to stick with CEXs. . Some CEXs do not require KYC, you can refer and use, but as I see: they have liquidity problems.

• 9 Best No KYC Crypto Exchanges for 2024

[jeraldskie11]

In terms of security it's safest to use DEX. But personally, I used CEX because even though we can't get the money if they run I can still assure that most centralized exchanges are safe. Other than that, I did a research for an exchange before I used it. That's why it's okay for me to use them. CEX has the better feature and efficient to use than DEX. Other than that, lot of user who trust CEXs and put a huge funds in it.

[KryptoBull]

In terms of security it's safest to use DEX. But personally, I used CEX because even though we can't get the money if they run I can still assure that most centralized exchanges are safe. Other than that, I did a research for an exchange before I used it. That's why it's okay for me to use them. CEX has the better feature and efficient to use than DEX. Other than that, lot of user who trust CEXs and put a huge funds in it.

This is the answer we received from the majority of members and investors: the majority understand that DEXs ensure anonymity and investors can self-custody crypto, but they still choose CEXs for simplicity, good liquidity, many attractive services and ease of use. CEXs have taken many measures to assert their reputation such as having proof of reserves, compensating users for hacks, improving the quality of global customer support.

I think this is a complete thing. normal and beneficial for the development of the crypto market: CEXs are used and break down barriers to market entry for newcomers.

[hugeblack]

If the banks in your country are bitcoin friendly and your investments are in large amounts, then using the CEX is preferable because of the low probability of being defrauded and the cheaper fees, while the DEX is important if you do not want to complete the identity verification or cannot do so, and you can also trade via cash or incur high fees.

[ABCbits]

I would like to know your opinion on CEXs and DEXs:

• Which do you prefer, CEXs or DEXs, and why?
• For CEX users: Does KYC concerns impact your choice of CEXs?
• For DEX users: Do you believe DEXs have the potential to completely replace CEXs in the future?

1. DEX for swapping between 2 coins, CEX for swapping between a coin and a fiat.
2. Yes, because few CEX still offer optional KYC.
3. No, some people would still choose convenience or legal protection despite reduced privacy.

[UNIVERSE]

Maybe this feels strange. but to be honest, so far, I prefer CEX. This is strange, isn't it? Moreover, many people don't like CEX because it requires KYC. but what else, I also use CEX the most often by far. But that doesn't mean you've never used CEX at all. It's just that, whatever it is, in the end it will end up on CEX too. Because this is what makes it easier for me to cash out someday to a bank account. This is quite a dilemma, but because it is so commonplace, it is more comfortable to use the features of some exchanges which happen to be CEX.

Actually, my position is like this:

https://www.linkedin.com/pulse/how-cex-important-crypto-market-nest-web3

[I-Bit]

• Which do you prefer, CEXs or DEXs, and why?
• For CEX users: Does KYC concerns impact your choice of CEXs?
• For DEX users: Do you believe DEXs have the potential to completely replace CEXs in the future?

1. I prefer to use CEX if I consider the comfort and the varied features for trading.
2. Sure. I want to avoid KYC on the CEX but it is impossible. So I just choose the most reputable CEX although I still need to follow KYC there.
3. I don't believe it because most people prefer using CEX. They also can be easier to withdraw to the banks through CEX.