Decentralized Exchanges : What It Entails #001
Hello great minds,
With a humble heart I happily come before you all today to discuss on an issue of great importance in the cryptospace.
I trust you are doing perfectly fine and you are enjoying your activities in the community and you are combining efforts with fellow steemian to promote steemit on twitter and other social media platform.
Today, we shall be learning about decentralized exchange, please stay tuned.
WHAT IS DECENTRALIZED EXCHANGE
Decentralized exchange (Dex) is a very important concept within the blockchain and crypto ecosystem.
It serves as a representation of a paradigm shift In a way that cryptocurrencies are being traded and managed.
Decentralized exchange which is often used in it's abbreviated form "DEX" can be explained to be a type of cryptocurrency exchange platforms that operates without the need of a middleman or the central authority.
Unlike the centralized exchanges "CEX" where users will have to make a deposit of their money into a centralized entity's wallet.
And to withdraw, they will need to place orders on the order book managed by the centralized entity.
With the use of Dex, users are allowed to trade directly from their wallet with the use of the blockchain technology and smart contracts.
HISTORICAL CONTEXT OF DEX
The idea of decentralization can be traced and dated back to the introduction of blockchain technology with bitcoin in the year 2009.
However, the first functional decentralized exchange came about with the introduction of ethereum with it's smart contracts in 2015.
Some early decentralized exchange like etherdelta opened the way for other decentralized exchanges like uniswap, curve finance and sushi swap which become very popular in the boom of decentralized finance in 2020.
CONCLUSION
We have explained in simple terms what a decentralized exchange is and we have also discussed how it originated.
In our next meeting, we shall learn more about decentralized exchange and I believe you all will enjoy this discussion.
Thank you, friend!
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