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We will examine two types of decentralized exchanges: Orderbook DEXs AMM DEX Orderbook DEXs resemble centralized exchanges (CEX) in their interface and operational principles. Trading participants place their orders to buy or sell their cryptoassets on the exchange, and a deal is reached when the stated prices match. The transaction takes place only when there is a counter order for a transaction from another user. Unlike on a CEX, where the exchange itself serves as the third party and is responsible for processing a transaction, the smart contract, i.e. self-executing software, takes care of this. AMM DEXs (automated market

A smart contract is computer code with a set of rules that are executed when certain conditions occur. This happens automatically, without human involvement and without trust between the two participants of the transaction. But what happens if a developer accidentally or intentionally makes a mistake in a smart contract? Participants lose their money. At the same time, typical critical errors in smart contracts are usually detected by automatic analyzers. But when we want to check the high-level logic of smart contracts and the compliance of the rules with the stated goals, this requires a rather complex audit involving specialists who

This post describes the key differences between the decentralized and centralized exchanges (DEXs and CEXs) briefly and in little detail. A few examples of CEXs are Binance, FTX, Coinbase, and Kraken. A few examples of DEXs are Uniswap, dYdX, and PancakeSwap. For the full lists, see coinmarketcap.com: DEXs, CEXs. DEXs versus CEXs: • Faster to operate as there is no need to register and no need to replenish the deposit beforehand. • As a rule, total fees are lower, since you don’t need to replenish the deposit and then withdraw funds from it to put them in the wallet. • Since there is no intermediary organization, there is no on

DEX stands for ‘decentralized exchange,’ where users can trade and exchange cryptoassets (coins and tokens) directly, with no intermediaries such as the exchange itself or a broker. Users don’t have to keep their cryptoassets at the exchange unless they want to. The blockchain fulfills the role of the intermediary and guarantor of the deal’s completion on a DEX. In fact, a DEX is a marketplace where any person with access to the Internet can trade. And there is no need to generate accounts or obtain permission from the exchange. Technically speaking, a DEX is a set of smart contracts, or software which, when specified conditions occur (for