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GLOSSARY · BLOCKCHAIN & WEB3

CeFi (Centralized Finance)

What CeFi (centralized finance) is in crypto: exchanges and custodians with an intermediary, how it differs from DeFi and what users gain and lose.

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What is CeFi?

CeFi (Centralized Finance) refers to a model of financial services based on cryptocurrencies but managed by centralized entities.

These platforms act as intermediaries and custodians of funds, offering products and services similar to those of traditional banking, but on digital assets.

Typical examples of CeFi platforms include Binance, Coinbase, Crypto.com or Nexo, among others.

The main features of CeFi are:

  • Asset custody: the user hands over control of their cryptocurrencies to the platform.
  • Integrated financial services: asset exchange (trading), interest accounts (staking/lending), crypto cards, secured loans, etc.
  • Simplified experience: accessible interfaces and customer support, ideal for non-technical users.
  • Regulatory compliance: they tend to apply KYC/AML policies and operate under licenses in different jurisdictions.

Learn more: What Is Blockchain and How Does It Work? Types, Real Examples and Limits

Explained simply

CeFi is like a bank, but for cryptocurrency. You give them your crypto-assets (such as Bitcoin or Ethereum), and they keep them, move them or give you interest for having them there. You don't need to know technology or manage private keys.

You trust a company (like Binance or Coinbase), which takes care of everything: exchanging your coins, storing them, lending them or helping you use them. It's easy and fast, but you depend on them.

CeFi: key points

  • Dependence on the solvency and security of the company.
  • Possible freezing of funds in the event of a crisis or regulations.
  • Lack of transparency about internal operations.

CeFi: advantages

  • User-friendly interface and easy access.
  • Liquidity and speed.
  • Customer support.

CeFi: disadvantages

  • Risk of bankruptcy or freezing of funds
  • Lack of transparency.
  • You don't control your private keys.

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DeFi (Decentralized Finance) Bitcoin Blockchain

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This entry is informative. It is not legal, tax or investment advice. The rules cited change: check the current version in each country’s official gazette (for Spain and the EU, BOE and EUR-Lex).