This project will explode, absolutely explode in value, and you can be a part of it because they haven’t started yet.
Cardano will soon hard fork, allowing for all sorts of exciting things like Defi and Smart contracts. But a big part of this will be a decentralized exchange, also known as a DEX. And more specifically, the Cardano DEX, who beats everyone else out.
Let’s talk about what a decentralized exchange is, why they’re so extremely valuable, and then we’ll break down all of the projects that are aiming to be number one.
And all the details that you need to know. So this will help you build a clearer picture of who might be the big winner here.
What Is A Decentralized Exchange?
To set up this whole article, we need to first talk about traditional centralized exchanges. These are those typical exchanges you hear about Binance, Coinbase, Kucoin, Kraken, Gemini.
The big companies that you hear about all the time are making tons of money. So here’s how a centralized traditional exchange Works. And don’t worry, we’re going to keep it non-technical.
First, off you deposit money or some cryptocurrency into an Exchange. The exchange is now a custodian of your asset. You can kind of think of it like you have a gold bar. And you’re storing it at your friend’s house.
In their safe. They’re a custodian of your gold bar. That’s kind of what these crypto exchanges are doing for your crypto assets. Now you decide. You know what I think Elon is feeling frisky today.
Grimes is in a good mood, so Elon’s in a good mood, and he might go ahead and mess around and move the whole crypto market with a tweet.
So you think I’m gonna buy 69 000 worth of Ethereum as a true American should. You place the market order of ether.
The order goes into the exchanges order book, where it matches you with a seller or multiple sellers who are selling 69 thousand dollars worth of Ether.
The transaction settles. You pay a 345 dollar fee to coinbase. Brian Armstrong’s net worth goes up, and you’re now a proud owner of ether. And this is great.
But we can do better. So let’s change the scenario, and I’m out. Again, i̇ want to sell my 69 000 usd worth of ethereum.
So this time, you decide to use a decentralized exchange like Uniswap. The biggest DEX on the ethereum network to facilitate the trade.
Here’s how that Works;
You connect your wallet to a DEX like Uniswap, Venus, or Pancakeswap. Using either a surface like metamask or a hardware wallet like a ledger.
Your funds stay in your wallet the DEX never holds your money. The DEX is not a custodian of your money. It’s only a platform, unlike a centralized Exchange.
The money stays in your wallet. So your wallet is connected, and now you place a sell order for 60.000 dollars worth of ether in exchange for 60.000 dollars worth of USDC.
It’s also an important note that DEX’es can’t exchange fiat currencies like the us dollar. Read More…
Categories: CARDANO ECOSYSTEM, DEFI - DECENTRALIZED EXCHANGE
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