Centralized Exchange
A centralized exchange (CEX) is a digital platform that facilitates the trading of cryptocurrencies and other digital assets through a centralized intermediary, which manages user funds, order books, and transaction execution. It acts as a trusted third party, offering services like fiat-to-crypto conversions, spot trading, derivatives, and custodial wallets. These exchanges are known for their high liquidity, user-friendly interfaces, and regulatory compliance in many jurisdictions.
Developers should learn about centralized exchanges when building or integrating cryptocurrency applications, as they provide reliable APIs for trading, market data, and account management, essential for fintech or DeFi projects. They are crucial for scenarios requiring high-speed transactions, regulatory adherence, or user onboarding with fiat currencies, such as in trading bots, portfolio trackers, or payment gateways. Understanding CEX operations also helps in comparing with decentralized alternatives for security and efficiency trade-offs.