Exchanges are divided into two types: centralized (CEX) and decentralized (DEX).
The advantage of centralized exchanges is the presence of legal regulation (in most countries), high transaction speed, the ability to transfer cryptocurrencies into real money. Among the disadvantages: cryptocurrency transactions are not registered in the blockchain, so all cryptocurrencies are on the same exchange account. The user identification procedure (KYC) is being actively introduced. If a person refuses to pass it, then his account in the crypto exchange may be frozen.
Decentralized exchanges do not have legal status, the transaction speed is much lower and there is no possibility to exchange cryptocurrencies for fiat money. However, their advantage is the record of each transaction in the blockchain and anonymity.
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