Crypto Academy ||Season-2|| Week 3|| Homework Post for @yousafharoonkhan|| Decentralized and Centralized Exchanges
It is an Exchange in which all the activities are controlled and handled by the Exchange itself. Seller and Buyer are totally dependent on Exchange. Seller and Buyer should follow the all rules that are defined by the exchange. In this system Exchange plays as middle man between seller and buyer. Trade is done with the help of Exchange. They do nothing without the interference of Centralized Exchange. If the Seller and Buyer not follow the rules, term and condition then they will not be able to do any transaction with in the exchange. Further if seller want to sell and Buyer want to buy the asset then they should get permission from exchange for doing the transaction.
In Decentralized Exchange not all the activities are controlled by Exchange But few of them are controlled by Exchange. In Decentralized Exchange Seller and buyer are not dependent on the Exchange. They can trade without the permission of the Exchange. There are few rules and regulation of Decentralized Exchange. In Decentralized Exchange Seller and buyer do trade according to their rules and perception they can do as they want. All the transactions and Trades are done the users. There is not interference of Exchange. There is no middle man in seller and buyer deals. Every Seller and Buyer have freedom to do transaction. Seller and buyer can trade any time they want, there is no time limit.
| Centralized Exchange | Decentralized Exchange |
|---|---|
| All the Transection are Controlled by Exchange | There is no Control Decentralized Exchange on Transection |
| Due to low Sell and Buy on Centralized Exchange are sometime Slow. | Transection of Seller and Buyer is done without any delay. |
| In Centralized Exchange There is option of spot, margin and future trading option is available. | In Decentralized Exchange There is no option Include regarding spot, margin and future trading. |
| Verification System is more Complicated then Decentralized Exchange. | In Decentralized Exchange the Verification System not include the technicalities. |
| Transections are done only when Exchange allows | Transections are done independently. |
| Charges on Transection are high. | Charges on Transection are very low. |
| Transection is done with the involvement of third party. | They denied the interference of Third Party. |
| There is an issue of Maintenance when we trade at any time. | In Decentralized Exchange we can trade at time. |
| Volume in term trading is high | Volume of Decentralized Exchange is lower. |
| Its easy to used. | It is difficult to use. |
| Centralized Exchange is less secure. | Decentralized Exchange is more secure, No one can easily hack. |
User-Friendly: Centralized Exchanges are user-friendly. User can easily make transection on centralized Exchange. User can view his account balance on application and website.
Reliable: Centralized Exchange support layer of security and reliability. In doing transection it supports high level of comfort
Security Risk: It has high security risk. Our Asset are less secure in centralized exchange.
Transection Fees: Centralized Exchanges charge high transection fees. It can especially effective to user or customer when customer or user make large transection.
Binance
Binance is the most well-known Centralized Cryptocurrency Exchange in the world. It is developed in year 2017. Binance is developed by Changpeng Zhao. Developer of Binance Exchange also develop his own Binance Coin BNB. It is also created in July 2017. It is the world most popular exchange. Binance is well known cryptocurrency exchange because it is fully operational is most of the countries in the world. One more is things is its low transaction fees, it charges about 0.1% of the transaction. Binance Exchange support up to 150 crypto coin for trading, these coins include the Bitcoin, Litecoin, Ethereum and its native coin Binance Coin. It provides wallet to his users or trader, where they save their crypto asset.
It is basically known as crypto-to-crypto trading centralized exchange. It means that trading is done on this exchange between two cryptocurrency pairs like BTC/ETH. Binance is based on multi-tier architecture. It used high quality processors. Binance is also uses multi-cluster architecture. Binance processor are so fast it process around 1.4 Million order per second.
Binance use Initial Coin Offering to enhance the funds. Binance Exchange is used by very large number of participants in the world. Before Starting Binance use we should Verify our self. Binance only support three types of Order trades. Limit, market and Stop limit Orders. Limit order is executed only when price is set by the trader. Market Order is executed at the spot on the best price available in market price. Next is Stop limit order is only executed when its price is reached at specified level.
Binance support five types of Order. It supports only for the futures contracts
- Limit
- Market
- Stop Limit
- Stop Market
- Trailing Stop
Coinbase
Coinbase is also a centralized exchange. It is created in 2012. It works perfectly since it is created. Coinbase exchange has solid up to date system. Further, it is exchange that has service rendered. Coinbase Exchange wallet is built on the decentralized system, and system permits to it users to navigate between two system and utilized the worst system as they want at a specific time period. Coinbase Exchange charge 0.99-2.99 USD, and it depending the nature of transection that we made and it also depend on the volume of the transaction that carried out. Coinbase exchange is fully operational with licensed in altogether 40 US States and other regions. This the strength of the Coinbase Exchange.
For this concerned I will used Uniswap for the installation process. This process helps you that, how to installed the Metamask on your computer. Metamask is cryptocurrency Wallet for user to interact on the Ethereum block chain. It gives support only to those token that are running on the Ethereum block chain.
Step 1:
- First, we login into the Metamask via Metamask.io web address as you see in the figure.
- We Click on the Download load button that is located on the right top of the screen
Step 2:
- Next, we download the button on the chrome. I will prefer to you to installed this one on the chrome browser.
- Then click the install button as shown in the figure.
Step 3:
- Then you need to click on the place that I marked at right bottom.
- Click on the Metamask Tab.
Step 4:
- In this way Metamask is added to our Chrome browser as an extension. Now it a time to configure the Metamask where the limbs are. Then we need to click on the Logo of the Metamask.
- Then Click the “Get Started” Button as you see in the figure.
Step 5:
- In next screen we see the there are two options. In first we can restore our previous account the placed where we left. For this purpose, we need 12 words seed code phrases that we had before.
- Now we click on the right bottom marked button that create wallet to further processing.
- Next Click the Agree Button to agree the terms and condition of Metamask.
Step 6:
- Next, we need to enter the password that is required by 8-character min.
- Next, we re-enter the password for conformation.
- And then click the on the check box.
- The click the Create button.
Step 7:
- Next the things are important that we need to ready it carefully. In this figure when click on the Revel Secret button then will reveal the 12 words secret code that you should only know about it no one else.
- We need to copy these 12 words and save somewhere.
- Click on the Approve Button that is marked on the bottom of the figure.
- Then Click on the All Done Button.
Step 7:
- Our Account is successfully created. Click on the Start Swapping Button. The marked on bottom.
Step 8:
We next, we are able to log in to wallet. We can Interact with the exchange through the Metamask wallet. As show in figure.
We can also make Swap transaction in Metamask wallet. For instance, I want to make trade of convert 2 ETH to LINK. As shown in figure.
I cannot perform this transaction because my balance not enough to make transaction.
Step 1:
- First, I Login to Uniswap.org website as shown in figure.
- Click on the Button that is marked on top Use Uniswap.
- Click on the Select Token Button.
Step 2:
As you see i convert 2 ETH To 4563.77 BAT. As you can see in figure. To do this we click on the Connect Wallet Button that is marked in figure.
Step 3:
Then select the Metamask tab.
Step 4:
After selecting the wallet address Click on the Next Button.
Step 5:
Then Click on the Connect Button.
As you see connecting is no done and my transaction is failed due to not enough balance.
It similar to buy on Uniswap platform. I will Sell BAT and Buy ETH. I will only change the Location of Token. It is decentralized exchange understand that I do not make transaction in Metamask account. This account does not allow to me make transaction because does not work if you don not have balance. I will by Ethereum.
Step 1:
As you see in figure, I have bought 1.32 ETH in 3000 BAT. To make the transaction we need to click on the Connect to Wallet Button as marked in the figure.
Step 2:
I need to select Metamask as shown in figure.
Then Click on the place that is marked in the screen. That is Next button.
Then Click on the Connect Button to connect to Exchange.
When we click on the connect button Connect is being established but transaction is not place because I have no balance in my wallet.
First of all, thanks to professor that giving us lecture about Centralized and Decentralized Exchanges. I have learned many things from it. I learned that what are the advantages and disadvantages of Centralized and Decentralized exchanges. I know about which is the best centralized exchanges in the world. I know more about the Binance and Coinbase as well as Houbi Exchange. I learned about how to make transection or Buy in Metamask and also learned about how to sell on the Metamask. I also learned about the how to use Metamask and make transection on Metamask. Uniswap is very famous exchange in the world. I explained that how transection is handled on Uniswap exchange.
Thank again to Professor to giving us knowledge.
@yousafharoonkhan
Written By:
@abdulsabor
First respected student Thank you very much for taking participate in Steemit Crypto Academy Season 2, Week 3 course class..
you did not show last trade of cex
i could not see your swap of any coin after connecting with uniswap
you used copyright images in home work that are not allowed
thank you very much for taking participate in this class
Grade : 6