Un Centralized exchange, or CEX, is a website or application where you can buy and sell cryptocurrency as if it were a digital exchange. But instead of doing it directly with someone else, it's the exchange company that keeps your money and does the operations for you. It's easy to use, but you need to trust that company so it doesn't fail you.

‍

Un Centralized Exchange (CEX) is a digital platform for the exchange of cryptographic assets in which a centralized entity acts as an intermediary and guardian of user funds. Instead of making exchanges directly between peers (as in a DEX), users of a CEX deposit their cryptocurrency or fiat money in accounts controlled by the exchange, which facilitates transactions through its own internal order matching engine (Order Book).

CEXs offer significant advantages such as high liquidity, intuitive interfaces, support for multiple payment methods, and advanced trading tools. They also usually provide access to complementary services such as staking, futures, derivatives, loans, launchpads or crypto cards. Popular examples include Binance, Coinbase, Kraken, Bybit, or Bitfinex.

However, when trading within a CEX, users they don't have direct control over their private keys, which implies that they delegate the custody of their funds to the company. This introduces risks such as hacks, account freezing, operational failures or unilateral regulatory decisions. In addition, CEXs must comply with policies KYC/AML and other national or international regulations, which may limit user access or privacy.

From a technical and economic perspective, CEXs are essential for connection between the crypto ecosystem and the traditional financial system, acting as entry and exit ramps (fiat ↔ crypto), and providing reference prices and liquidity on a global scale.

‍