CEX and DEX Wallets & Exchanges Explained

Centralized exchanges (CEX) are cryptocurrency platforms operated by companies that act as intermediaries between buyers and sellers. Examples include Binance and Coinbase. These platforms offer high liquidity, fast order matching, fiat deposits, customer support, and simple interfaces, which makes them attractive to beginners and active traders. However, CEX wallets are custodial, meaning users do not control their private keys and must trust the platform’s security, compliance, and solvency.
Decentralized exchanges (DEX) run on blockchain networks using smart contracts and do not rely on intermediaries. Platforms such as Uniswap allow users to trade directly from non custodial wallets, keeping full ownership of funds and private keys. DEXs emphasize transparency, permissionless access, and censorship resistance. The downsides can include higher gas fees, lower liquidity for small tokens, slower execution, and a steeper learning curve.
Overall, CEX and DEX serve different needs. Many users combine both to balance convenience, speed, security, and decentralization.