> For the complete documentation index, see [llms.txt](https://docs.bitfoot.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.bitfoot.com/new-to-crypto/understanding-cexs-and-dexs.md).

# Understanding CEXs and DEXs

Cryptocurrency exchanges come in two main types: **Centralized Exchanges (CEXs)** and **Decentralized Exchanges (DEXs)**. Both allow you to trade crypto, but they differ in how they operate and how much control they give you over your funds.

* **CEXs** (e.g., Coinbase, Binance) are managed by companies that oversee the platform and hold custody of your assets. They’re beginner-friendly, offer fiat on-ramps, and handle security for users. However, users rely on the exchange’s security and custodianship.
* **DEXs** (e.g., Uniswap, Raydium) run on blockchain networks without a central authority. You trade directly from your wallet, maintaining full control over your assets and privacy. DEXs often list new tokens early, though they can be less intuitive for beginners.

## Key Differences

| Feature                 | CEX                                       | DEX                                           |
| ----------------------- | ----------------------------------------- | --------------------------------------------- |
| **Custody of Funds**    | Held by exchange                          | Held by user                                  |
| **Account Requirement** | Yes (usually with KYC)                    | No (trade directly from your wallet)          |
| **Control Over Assets** | Limited, as exchange manages private keys | Full control, as users manage their own keys  |
| **Token Availability**  | Typically established tokens              | Wide range, including new/experimental tokens |
| **Fiat On-Ramps**       | Yes, can deposit and withdraw fiat        | No, requires crypto for trades                |

In summary, **CEXs offer convenience and security**, while **DEXs provide more control and privacy**. Most people use a combination of both: **CEXs for fiat on- and off-ramps** and **DEXs for token trading**.