DEX vs CEX

A CEX (centralized exchange) is a company-run platform — like a traditional brokerage — that matches buyers and sellers, usually holds customer funds in custody, and requires an account and often KYC verification. A DEX (decentralized exchange) is a set of smart contracts that lets users trade directly from their own non-custodial wallets, typically using liquidity pools instead of a company order book, with no sign-up required. CEXs tend to offer more liquidity, fiat on-ramps, and customer support, while DEXs offer more privacy and remove the risk of an exchange mishandling or losing custody of your funds. Many traders use both: a CEX to convert cash to crypto, and a DEX for certain trades or tokens not listed on centralized platforms.