Bridging the Gap Between DEXs and CEXs

DEX Provides Superior Security

Before we delve into what might be the reasons behind this phenomenon, let me first qualify my argument that DEXs are way better than CEXs. DEXs are more secure for the simple fact that all traders never lose custody of their digital assets. Take for example Newdex, once trades are executed their funds are sent to an entrustment account that is governed by a smart contract and automatically matches and settles the trade when certain conditions are met. Transactions are consummated on-chain and Newdex operators never lay their hands on customer’s funds.

Why Traders Still Prefer Centralized Exchanges

Now let me explain why despite this obvious advantage of DEXs many still prefer to use Centralized Exchanges. The most obvious reason perhaps is people tend to think that Centralized exchange with all their years of experience, technical expertise, and security systems is the most secure place to store their digital assets, of course, this is not true for reasons we have already stated above. A lot of these exchanges are relentless in marketing themselves as a safe venue for trading hence this belief prevails.

Addressing This liquidity Problem

Take for example Newdex whose developers have been hard at work constantly researching ways how to address this major challenge. Previously they have started supporting several different chains in their platform, supporting sister chains of EOS as well as the Tron blockchain. To enhance liquidity even further they also started multi-chain support of the biggest stablecoin in the market USDT (TRC20 USDT, ERC20 USDT, and EOS USDT). Recently they launched BTC/USDT and ETH/USDT trading pairs for cross-chain trading and just like that they have included two of the biggest cryptocurrencies in terms of market capitalization in their platform.


Liquidity has always been the problem in decentralized exchanges but DEXs like Newdex have been finding innovative ways how to address this problem. While there is still a lot of work to do, the DEXs like Newdex will continue to work hard exploring different solutions for cross-chain trading technology and perhaps one day will be able to offer us the same level of liquidity that CEXs has to offer. For now, let us enjoy the many innovations in decentralized exchanges. If you are not still into DEX trading you might as well start learning how to do it now as sooner or later they will become the dominant force behind decentralized and alternative finance.



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Anidel Silvano

Anidel Silvano

Blockchain/crypto enthusiast from the Philippines.