What is a Crypto Exchange?

A cryptocurrency exchange is a digital platform where users can buy, sell, or trade cryptocurrencies. Exchanges can be centralized (CEX), where a trusted third party acts as an intermediary and controls user funds, or decentralized (DEX), where transactions occur directly between users, using smart contracts without a central entity. Centralized exchanges provide liquidity and convenience but introduce risks like hacks or mismanagement, while decentralized exchanges offer greater privacy and control over assets but often come with higher costs or less liquidity.