Today i am writing homework task for @yousafharoonkhan which is about centralized and decentealized exchanges
Write the definition of Decentralized and Centralized Exchange in your own words.(definition should cover exchanges ,not system) only explain in your own words, after understand the exchanges
Decentralized exchanges are trading platforms where execution of trade between two parties does not involve any middleman for any aspect of trade. Therefore, trading rules and regulations are laid by the two parties in contract themselves.
Centralized exchanges are those trading platforms where a middleman is involved in execution of trade between two parties and therefore the two parties in trade have to work under rules and regulations laid down by third party ( middle man).
Explain in your own words the difference between decentralization and centralization exchanges (answer should related exchanges ,not over all system.. (answer must be written in oun words, copy paste or from other source copy will be not accepted)
Some of the major points of difference between Centralized and decentralized exchanges are as:
Setting trading niche
For starting trade on any platform trader has to set his trading niche before starting actual trade. Decentralized exchanges do not ask for personal details of a user on the contrary to set start trading on a centralised exchange , user has to give full identity proof by uploading sensitive documents like photo identity proof , banking detail like PAN card and mobile number etc. So there is no concept of user anonymity on centralised exchange, however it holds true for decentralized exchange only.
Securiry
Security of assets is such an aspect, which no user would like to compromise with, at any point of time. so it very crucial to look at security component of an exchange. As for security of the funds on the exchange is concerned, decentralized exchanges are far better than centralised exchange because in decentralized exchange user has absolute control over his assets where as in centralised exchange an intermediary is involved that has absolute control over your assets. In centralised exchange, a trader does not have access to private key, he only makes trade with the help of password that need to be set at the time of creating account on exchange.
Liquidity and Trading volume
Centralized exchange is performing better in both these parameters. As centralized exchanges are more popular in terms of user base . More trading volume and more liquidity leads to lesser transaction time which in turn makes exchange less susceptible to volatility of prices. DEX on the other hand take more time for transaction completion and therefore price fluctuations can alter the final yield of traded transaction.
Transaction fee
Transaction fee charged on centralizeed exchanges is higher than decentealized exchanges. It may be due to faster transaction speed or lesser time taken for completion of transactions. Basically we are always in hastle and we want things be done instantly and so we prefer paying high gas at centralized exchanges than waiting at DEX.
User friendly
Centralized exchanges are easy to use and do not demand technicality when compared to the DEX. User interface in centralised exchanges is easy to comprehend and feature rich. Moreover, in centralised exchanges customer care facilities in the form of live chat, call, email etc are there to help users. So you feel more comfortable in using centralized exchanges as theee is someone to listen to your complaints, if any.
write about any 2 best centralised exchanges of 2021 . why are they 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 )
Scores of centralised exchanges exist as of now, but the two exchange that I would like to write about are Binance and Poloniex. Of these two , i have been using Binance since I am on steemit and I have only created profile on poloniex but have not used it for trading purposes. And why should i be looking here and there,
when i am satisfied with one exchange.
BINANCE
As for ranking by coinsmarketcap is concerned based on exchange's traffic, liquidity, trading volumes, and confidence in the legitimacy of trading volumes, Binance is world's number one spot trading exchange. It was founded by Changpeng Zhao in 2005 and was based in china, but has now moved out of china to japan. I like this exchange because it meets all the requirements needed to be at the top. Morever, ease of registration and trading is appreciable.
My Binance profile, you can see, i still have 40$ worth of BTC
POLONIEX
Poloniex is more than half a decade old centralised crypto- assets exchange standing as a solid entity in the cryptoaphere. It is a global crpto to crpto exchange. Poloniex supports diverse range of crypoccurrencies. Mentioning all of them is not mandatory, however just for emphasis, I will. mention some of them like
Bitcoin
XRP (Ripple)
Litecoin
Ethereum
Steem.
Bitcoin Cash
BitShares
Zcash
EOS
Siacoin
Bytecoin
Ethereum Classic
Peercoin
Burst
Syscoin
and many more.
Poloniex has very simple and fast verification process and has simple user interface with diverse and exciting trading features. We can explore it, either directly on the web or mobile apps available.
My poloniex level 1 verified
i like Binance for its simple user interface, high liquidity and high trading volume, instant execution of trade, better security, support diverse crypto pairs etc. Same holds true for poloniex also. In addition both these exchanges support margin trading, P2P and future trading alongside spot trading.
Install Metamask, and share step by step screenshot ,(Practicle step by step )
Here is step by step approach to install Metamask.
Note: For security purposes, metamask won't allow you to take screenshot of steps herafter untill you log in to your wallet.
Click on get started. Next there are three options to choose from. Firet, "import using seed phrase"- it is for those who already have metamask wallet and they can login with seed phrase that they are provided.
Second option is "synchronise with metamask extension". Third is, "create new wallet". Let's click on third option to create new wallet.
Next step is to create a new password. Try to use a strong password of at least 8 digits. One thing to understand here is that , metamask cannot recover the password , if it is lost.
Next step is to secure your wallet by storing seed phrase. Best way is to store it offline on a piece of paper or on cold wallet.
You are given a 12 word seed phrase. Store it offline and than you will have to rewrite it for confirmation purposes in order as given.
Next a congratulatory message will appear.
Click start and next you got to see, tips to improve metwmask.
Click on, " i agree" and you are done.
How to use Uniswap exchange , and Swap/buy or swap/sell any coin (practicle step by step )
UNISWAP is a creation of a great & genius mind Hayden Adams. It is a decentralised cryptocurrency exchange based on Ethereum blockchain . UNiswap facilitates automated transaction via smart contracts. Uniswap uses no intermediary and no order book . It is GPL Licenceced open source software.
How to use UNISWAP.
To use UNISWAP, set up any ERC-20 supported wallet such as MetaMask, WalletConnect, Coinbase wallet, Portis, or Fortmatic. If you want to trade on UNISWAP , have some ERC 20 token in your wallet which you have to use to pay GAS.
Click on use uniswap and following page will open.
Click on connect wallet and you will see below interface.
To connect it to metamask installed above. Click on "Wallet connect" amd you got to see.
- Click on connect and wait. It will open directly into metamask main page.
Next you decide whether you want to receive, buy, sell or swap any asset .
Let's try to swap 1ETH for UNI. Click swap.
- Let's say, we want to swap 1 ETH for UNI as shown. Click on "Get quotes". Wait, it will calculate amount of UNI, I'll get.
Thank you
First respected student Thank you very much for taking participate in Steemit Crypto Academy Season 2, Week 3 course class..
I have read your assignment very satisfactorily
you explained every step very well and thank you very much for taking participate in this class
Grade : 8.7
Thank you very much for kind review.