An Advantage That Dex Users Gain
An Advantage That Dex Users Gain – A decentralized exchange (DEX) is a type of exchange that specializes in peer-to-peer transactions of cryptocurrencies and digital assets. Unlike centralized exchanges (CEXs), DEXs do not require a trusted third party, or intermediary, to facilitate the exchange of cryptoassets.
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An Advantage That Dex Users Gain
Decentralization brings with it many advantages over centralized counterparts. First, new cryptoassets almost always appear considerably earlier on DEXs than CEXs. This is because CEXs must manually add cryptoassets to their system. Adding new projects typically entails layers of compliance, testing, and authorization by layers of management. With a DEX, any new token can be automatically added to the exchange without asking anyone.
DEXs do not require Know Your Customer (KYC) or anti-money laundering (AML) measures. The exchange itself does not exist in any one jurisdiction, so there isn’t a regulatory framework that applies to it. This has a number of implications. Firstly, DEXs conserve privacy. You can use DEXs anonymously without having to divulge information about yourself, including financial information such as your account balances. Furthermore, you can start trading immediately at a DEX. There is no lengthy verification process to pass before you can trade.
DEXs can benefit everyone, but they have the most utility in the developing world, where a lack of robust financial infrastructure has hindered traditional financial businesses from accepting many customers. The World Bank estimates that 1 billion people do not have an official proof of identity. These people would be unable to pass the loosest of KYC AML measures, yet with access to the internet they’d be able to trade on a DEX.
Lastly, you don’t have to trade to earn money on a DEX. There are several ways to earn, for example, anyone can provide liquidity on a DEX and earn a portion of fees. Additionally, many DEXs integrate bonus rewards. These are typically paid in the DEX’s governance token.