Crypto Exchanges in Six Steps
Web3Exchange.com explains how crypto exchanges work, centralized and decentralized, so you can trade with your eyes open.
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An exchange matches buyers and sellers of digital assets and settles the trade, for a fee.
Exchange
A company runs the platform and holds customers' funds. It is convenient and usually requires identity checks.
CEX
A DEX runs on smart contracts. You trade from your own wallet, and no company holds your funds.
DEX
Some exchanges match orders from a book of bids and asks. Many DEXs trade against a pool of tokens supplied by other users instead.
Liquidity pool
Beyond trading fees, the price can move between placing and filling an order. Large trades in thin markets slip the most.
Slippage
Check licensing in your country, security history, withdrawal limits and whether the exchange publishes proof of the reserves it holds.
Proof of reserves
Educational only, not financial advice. Crypto prices move fast and you can lose what you put in. Some links are affiliate links; we may earn a commission at no cost to you.