In this article, we take a deeper look into the landscape of centralized and decentralized exchanges, the difference in operating, trading fees, and volumes.
Bitcoin started out as a technological experiment more than a decade ago. Since then, the global financial markets have undergone a tremendous shift. At the center of the digital currency revolution is blockchain technology which gave rise to the first-ever smart contract platform, Ethereum.
To put things into perspective, the veteran US exchange processed around $11 billion in transaction volume in May 2020. By the end of January 2022, the exchange’s monthly transaction volume stood at $120 billion, meaning an increase of 1,000% in a period of just a year and a half. This also demonstrates that – the more volume of transactions being processed, the higher the revenue to the centralized exchange and their shareholders.
that Uniswap has managed to capture a significant market share with respect to exchange services even though it started operating six years after Coinbase.Users are slowly starting to move from CEXs to DEXs. The latter’s appeal is not limited to factors such as privacy and security. Yield opportunities are yet another driver.