Steemit Crypto Academy Contest / S1W2 – Reviewing Centralized Exchanges by @nadeesew
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This is the second week of the Steemit Engagement challenge. This time we have to explain about the Centralized exchanges. I will also review about one of my favorite centralized exchanges.
Introduction
An exchange is a platform which is given the opportunity to exchange digital assets. In other words we can say that these are like financial Institutions which people deal with their assets. Not just exchanging but also these exchanges offer many services like staking, using online wallets, bank accounts etc.... Exchanges are of two type as centralized and Decentralized exchanges. There is a centralized authority in governing the centralized exchanges but for decentralized exchanges there is no any governing party.
Some decentralized Exchanges
- Uniswap
- Pancake Swap
- Kine protocol
- dYdX exchange
Some centralized exchanges
- Binance
- Coinbase
- Krakane
- Remitano
Discuss briefly Centralized exchanges and its Benefits to crypto users.
Centralized exchanges have a central authority to govern the platform. They function exactly the same way just like traditional exchange method. The full control of the exchange is with the central authority. Here the users has no access the private keys so the trust is in the hands of the authority as the respective company controls all the financial operations.
Centralized exchanges also maintain digital order books which contains buy and sell orders with volumes and prices. These are virtual records maintained by the central authority.
Some famous centralized exchanges are Binance , Coinbase , KUcoin etc...
Benefits that a trader gets from CEX.
- Crypto-Fiat money
The main benefit in CEX is that it allows the traders to exchange crypto currency to Fiat money. Users can have entry level deposits by depositing fiat money to buy crypto currency and then they can trade. Once they exit from the trade they can exchange their crypto currency to fiat money again.
- Possible Recovery
IN CEX if the user loses the password or forgets the password the central authority has systematic procedures to recover it without any burden. The security procedure of the CEX ask only the identity document to recover the password.
- Store Assets
The CEX stores crypto assets for the traders. There is a process for staking. It makes the trading easier.
What do you look out for when choosing an exchange to trade your crypto asset?
Limitations
I consider the amount of assets that the account can exchange per day. This is a fact that we must consider as we need to consider the amount that we plan to trade or exchange.
Security
In CEX the user needs two factor authentication to verify an account. That means we can be sure that the security is in a higher level.
Transaction Speed
The speed of an exchange is an important factor to consider. In CEX the transaction speed is really high and funds are sent to the account instantly. Having a speedy transaction is risk free.
Customer Support
The CEX exchanges having a high responsibility of the traders' assets they have a help desk. Traders can e mail the CEX authority and get the needed support.
Review your favorite centralized exchange and explain its unique features
BINANCE
Binance is one of the largest exchanges in the world by its trading volume. There is a two factor verification in the Binance exchange. It has a really well designed working procedure. This is the Exchange that I have been working with for past few months. I have identified its features clearly to the best of my knowledge. Let me explain a few.
Binance Lounch Pool
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Screensshot taken from my Redmi8 Mobile
In Binance it issues new tokens and also traders can a monthly profit by staking cryptocurrencies in the exchange. There is a feature called "Pool" in Binance. we can click on that and select the cryptocurrency to stake and the duration. The profit is calculated accordingly.
Staking ETH 2.0
Screensshot taken from my Redmi8 Mobile
There is a direct icon which traders can click and stake ETH 2.0 with the minimum requirements. Unlike other ways in Binance traders need only a small amount of ETH to stake and it is a quick and simple process.
Convert Token Dust
When traders deal with exchanges there can be little amount of dust remains in the wallet and there is noting to do with it. So here the traders have the ability to go to fiat and then "click on convert to BNB ". Then the remaining dust will be converted to BNB and you can save them.
Airdrop and competitions
In Binance traders frequently get the chance of airdrops and competitions. The overview of the Binance app gives all details about the on gong events so there is no need to wasting time searching for them.
Is there anything about your favorite exchange you will like to be changed? Discuss
I always feel comfortable with what is available in Binance and what facilities provided by the Binance authority. In Binance the minimum amount to trade is 10 $ but there are other exchanges which offer a lower amount that that so the beginners too can trade and get experience without falling into personal losses at the very beginning of a trade.
The thing that should be changed in Binance is the minimum of the trade. I think it would be easier for the if the amount becomes lesser than 10 $.
What shortcomings do you see on centralized exchanges and how do you think user funds can be protected since we don’t have access to our wallet private keys?
There are short comings that I see as a user in this exchange. In here as it is a centralized authority we use only our e mail address and password to log in and work on it and the active keys of ta user is not with the user. So the users need to apply to factor authentication for the security of the account.
As we are dealing with our fiat money or our own cryptocurrency I think this is a shortcoming that the authority has.
CONCLUSION
In conclusion, I think centralized exchanges are easy to handle and there is a good security for the trader. Binance is one of the best exchanges I have used. There are pros and cons in everything we experience so here it is the same too. We can take steps to minimize the shortcomings from our side and get the maximum use of the benefits given.
Yes @nadeesew, it is easy to handle, because of it's ease toward the features. Binance is one of the world online exchange and it is Centralized. You post is a food to crypto.
Your are true friend. Thank you for stopping by my post.
Excelente contenido amiga muy educativo gracias por compartir
Thank you so much
Your efforts in reviewing centralized exchange is greatly appreciated.
Your work is well presented and neat.. You also made a detailed explanation of various features and benefits.
Thank you for participating.
Thank you for the kind comment and thank you for stopping by my post.
Nice job. Centralized exchange platforms are one of the main topics in the world of cryptocurrencies. Your publication has quality and good data order. Thank you for sharing your knowledge, God bless you.
Waaw çok açıklayıcı bir paylaşım olmuş ellerine sağlık 🙏. Benim de favori borsan binance dir.
Very good entry friend, congratulations! binance is amazing and relatively easy to use, I personally consider it one of the best cryptocurrency exchange platforms. I like your explanation, I wish you success.
this is a great job, and I commend you for this excellent post. thanks for sharing. do well to check my entry out also
This is a really nice post, I love the emphasis on its speed and this makes CEXs good in terms of trading (buying and selling).