Hello Everyone,

Special thanks to professor @yousafharoonkhan for the great lecture.

Introduction

Before we begin discussing the topic of centralized and decentralized exchanges, we should first learn to understand what cryptocurrency exchange is all about.

What is cryptocurrency exchange?

Cryptocurrency exchange refers to places where you can buy or sell crypto. Every crypto exchange has its unique rules and regulations, they have different ways they benefit us.
We’ll discuss the topic of centralized and decentralized cryptocurrency exchanges to find out which one is better. To trade any cryptocurrencies, you’d have to use a cryptocurrency exchange. We shall be elaborating or extending our views to centralized and decentralized exchanges on cryptocurrency.

Centralized exchange provides an easy access and reliability while decentralized exchange contributes to the enhanced privacy. Both has its own benefits and concerns, for now, they serve to bring crypto markets into the broad frame. We shall also witness which of these cryptocurrency exchanges have benefited the Nigerians and other countries that issued a restriction or ban or penalty to its citizens for trading on cryptocurrency.

Question 1; Write the definition of Decentralized and Centralized exchange?

• What is a Decentralized Exchange?
A decentralized exchange is an exchange that does not rely on a third-party service to hold the customer's funds. Instead, trades occur directly between users (peer-to-peer) through an automated process. It’s important to know that after the Nigerian government issued a ban on cryptocurrency to its citizens, we(Nigerians) could still trade successfully through the help of Decentralized exchange. It has gone a long way to help the youths, although this process of peer-to-peer maybe slight difficult for beginners who would want to start trading as to not knowing how to go about it or get funded except by asking plenty of questions.

Advantages of Decentralized exchange

• One of the advantage of this decentralized exchange is the privacy it provides. Users are not required to disclose their personal details to anyone, except if the exchange method involves bank transfers, in which case your identity is revealed only to the person that is selling or buying from you and this is the new method that we have adapted to buying and selling cryptocurrency here in Nigeria.

• Another benefit of using decentralized exchange one is their "trustless" nature. You are not required to trust the security or the honesty of the exchange since the funds are held by you in your personal wallet and not by a third party.

What is a Centralized Exchange?

Centralized exchange is particularly the inverse of the Decentralized exchange since it relies on the third party service to hold the customers fund. Centralized exchange, CEX makes it easier for users to create an account or buy their first cryptocurrency. This helps to bring a new user into the system and has also made crypto popular. On February 2021, the central bank of Nigeria banned trading both buying and selling of any cryptocurrency because they observed that it is the means whereby scammers hide their money and also get there money without trace. Centralized exchange,CEX are easy to use, easy to access and they provide advanced trading functionalities like margin trading among others.

Question2;What’s the difference between Decentralization and centralization of exchange?

There are several differences between decentralization and centralization exchange and we shall discuss few as follows:

• Fees: Centralized exchange tend to impose little or more charges on their users for their services while Decentralized exchanges either have zero charges or a very minimal charges for matching orders on the blockchain.

• Security: Decentralized exchanges offer more security than centralized exchanges. In trading with or on a Centralized exchange, one need to consider that they can hack the third party which uses private key to access all the funds of the user and you could lose all your deposits while in decentralized exchange, there’s no risk or fear of hacking and losing one’s fund.

• Speed: Decentralized exchange are slower than centralized exchange because they have match and fill an order whereas centralized exchanges take few seconds to execute orders. Besides, a decentralized exchange can take up to one minute to complete an order, which is a considerable amount of time in comparison to centralized exchange.

• Regulation: It is easier to regulate centralized exchanges than decentralized ones. Regulating in a Centralized exchange, one needs licenses and have to adhere to the rules of the local regulatory authority of their region. In contrast to centralized exchanges, decentralized ones don’t have regulation because it’s highly challenging and this means that if a government bans crypto exchanges, decentralized ones can still operate in those regions.

• Control: In crypto exchange, the Centralized exchange have more control over ones account since it remains in the hands of the third party which runs the exchange. On the other hand, with a decentralized exchange, all the control of the account remains with you. You make all the decisions and also take all the controls as much as you care.

Question no 3: Write about any 2 best centralised exchanges of 2021. Why are they the best in front of you? ( show screenshot of your verified profile to make verify that you are really using them,or also share any one trade that you made in last 24 hours).

There are several Centralized exchange of 2021 such as the Binance, Coinbase, Coinmama, eToro, kraken, Bittrex etc.

Here, i shall be discussing the two best crypto exchange of 2021 and give some reasons why i choose them as the best. The two best crypto for me are the Coinbase and the Binance.

• Binance: This is one of the best crypto exchanges for both beginners and seasoned traders alike. Although it has several features and might be difficult for a beginner to understand for some moment but it has been the mostly used crypto exchange especially in Nigerians since it supports the peer-2-peer, (p2p) trading. With around 200 coins, it also has a native coin called Binance coin, BNB and it offers future trading, margin trading and much more. They charge a little fee for every transaction to buy and sell crypto. These above reasons are why I consider it as one the best crypto exchange of the 2021.

• Coinbase: This is one of the best Bitcoin exchanges online, with many beginners using Coinbase as a place to exchange fiat (real) currency into digital currency for the first time. This character has made Coinbase the most widely used for deposit and withdrawal of Bitcoin. The reason why i included it as one of the best crypto exchange of the 2021 is the character it possess as discussed above and the simple features it has too. It’s quite simple to access, simple to buy and sell your cryptocurrency.

I have received an Ethereum of the amount below recently through luno and the transaction was very straight forward and easy.

Question 4; Install metamask, and share step by step screenshot (practicle step by step).

MetaMask app is a boundary that allows us to visit or run Ethereum dApp in our browser without the full Ethereum node. The following screenshots are practical step by step installation of the MetaMask.

This is the metamask app on our App Store. We will click on where the arrow is pointed at to download it.

This sign shows that it’s undergoing a download process. We wait for some seconds or minutes depending on the network to download.

Our Metamask is fully downloaded and we have to click on the “OPEN” to have access to it.

Having opened the installed app, the next step is to get started which we click to see the next phase.

As someone who doesn’t have a wallet is supposed to create a new wallet by clicking the following.

Here we start creating a new wallet by getting a password.

Having done that, we click the start button to obtain a secured wallet phase.

Our wallet is secured

This is my seed phase and it is usually not reviewed to anyone else.

This seed phase follows a particular pattern and i have to cover some of them so that no one will have access to my wallet.

This stage require you to follow the pattern of the previous step.

This shows that i have successfully done the right thing by following all the necessary rules and patterns needed

This stage comes before the wallet is displayed.

This is my wallet. The $0 below shows that there is transaction.

###Question 5; How to use uniswap exchange, and swap/ buy or swap/ sell any coin ( practicle step by step).

This is my wallet and by left clicking as indicated by the arrow below, i get the result as seen in the next stage.

Before i can buy or sell using uniswap, i have to first click on the browser which will take me to the next stage.

It is important to know that this stage will require me to search and by doing so,i get the result in the next stage.

I input "uniswap.org"

This is the interface i get as a result of the previous stage and i only need to screw down to "App" where i can swap tokens and add liquidity as shown in the next stage.

All i need to do is to click on the App

This is it. By clicking " select a token" as per i want to buy or sell, i obtain the result as seen in the next stage.

By selecting a token,we get this result where i can search for a name or paste the address of the token i want to buy.

Conclusion

In conclusion i can say that both decentralized exchange and the Centralized exchange are truly important and they serve different purposes. I have also shown step by step installation of MetaMask and also how to swap/buy and swap/sell through uniswap exchange. I observed that uniswap exchange is a decentralized exchange since it does not involve a third party to trade.

special thanks to

@yousafharoonkhan