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Author: Admin | 2025-04-28
Evolution with innovation always sparkles! Cryptocurrency Exchanges has been modifying its architecture from the day of its birth. In the very initial days, Cryptocurrency Exchanges are designed to function in the centralized network as days go, this business gains popularity and stands straight as a promising business model. Later then, technology demands Crypto Exchanges to incorporate multiple dimensions.The core design of crypto exchanges is to act as the platform where one can buy or sell virtual currencies. Based on the working methodologies, functionalities, integrated features, service they are broadly classified as Centralized Exchange Decentralized Exchange P2P ExchangeThese exchanges have their own Pros and Cons. Let’s have a look!What are Centralized Exchanges?Centralized Exchanges are the earliest version of exchanges. It is the kind of ecosystem built with trust as the backend. Here, the admin of the Exchange has direct control on trading All the data, funds are stored in the central server. i.e, the single pathway for data. It enables quick and easy data handlingHow Centralized Exchanges Work?Centralized Exchanges more or less functions as a bank. The admin is the one and only the central authority of the exchange. Users store their own assets inside the exchange. Traders of the exchange might have their own individual private keys to access their Crypto wallets but all the assets are stored in the Centralized Server.It allows Fiat to Crypto trading Crypto to Crypto tradingNot all centralized exchanges support fiat to crypto trading, few exchanges that offer fiat to crypto trading are Kraken Coinbase Robinhood GeminiSplitted tradingCentralized Exchanges supports splitted trading, this feature allows sellers to sell Cryptos in bulk. For instance, if Alice wants to sell 20 BTC, the order matching engine matches the buy order of even small amounts in series and thus completes the trading process.Multiple Cryptocurrency wallet supportCentralized Exchanges supports
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