To be precise, Uniswap is an automated market maker (“AMM”) based liquidity protocol and is one of the most widely used dApps in all of DeFi. Very close in TVL is another leading DEX in the space Uniswap. With stablecoins demonstrating considerable growth over the last couple of years, and generally expected to grow in size with increased crypto adoption, the future looks bright for this behemoth of the DEX space. In the first half of 2022, Curve has integrated with Optimism, Moonbeam, and most recently with NEAR Protocol’s Aurora network. The Curve DAO, controlled by the CRV token, is also a major part of the puzzle and the accumulation race for the control of DAO has led to the aptly named ‘Curve Wars’.Ĭurve has been actively deploying across chains and is currently active across both L2 and alt-L1 chains. Curve also maintains composability as an aim and has integrated with Compound, Yearn Finance and Synthetix among others. Curve is an AMM-based DEX, which focuses its attention on stablecoins and other stable pairs and thus maintains lower fees, slippage and minimizes impermanent loss when compared to other competing protocols. Decentralized Exchanges ReviewĪny discussion on DeFi necessitates a conversation on the primary means of exchange in the decentralized world enter DEXes.ĭEXes have always commanded notable levels of TVL across DeFi and the category currently tops the charts in both TVL and number of protocols with over US$23B in TVL split across 470+ protocols.Īccording Binance Research Crypto Market Review, having peaked near US$25B of TVL earlier this year, Curve is the largest DEX in DeFi. Even if blockchain can support the development of decentralized exchanges, it is important to look out for notable DEX risks before participating in the market. Furthermore, the role of blockchain in empowering decentralized exchanges to facilitate trading has also come under scrutiny. The issues pertaining to market access and discrepancies in methods for individual and institutional investors to access decentralized exchanges are some prominent mentions.Īt the same time, the involvement of centralized third-party entities in the working of decentralized exchanges also presents questions. At the same time, people are also wondering about concerns like “are decentralized exchanges safe” for the right reasons. The use of decentralized exchanges has definitely presented a new array of possibilities for the DeFi sector.

Gas fees are usually cheaper in this type of exchange, and some of them offer no withdrawal fees. Usually, there is no middleman that can decide what occurs in the ecosystem. Traders use this type of trading platform when they want to exchange cryptocurrencies at market price without the intervention of a centralized authority.ĭecentralized Exchanges tend to work with self-executing agreements, removing the need for a third party to hold the funds of different participants. What does DEX mean in crypto?Ī DEX exchange is a trading platform that allows people to buy and sell their crypto assets and trade directly with other users. The examples of the hearings related to GameStop trading volatility showcase doubtful perceptions regarding mainstream adoption of decentralized exchanges or DEX. The rising use of decentralized exchanges has been responsible for radical growth in attention towards DEX risks apart from their advantages. With the introduction of decentralized exchanges, crypto holders could now move over the centralized exchanges by taking complete control of their assets.

The introduction of decentralized exchanges changed many conventional precedents in the crypto landscape. As a way of safeguarding the crypto holdings of their users, they store a bulk of it in cold wallets.Ī typical custodial exchange requests that potential users undergo the KYC process and without it, they are either not allowed to use the blockchain-based services or restricted on what services they can enjoy. It could involve using centralized exchanges or decentralized applications.Ĭentralized exchanges are custodial in nature, meaning that they hold the funds of users and have control over what occurs in the platform. There are different ways to exchange one asset for another in the crypto space.

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