What is a Centralized Exchange (CEX)?
Hello everyone, here is a new article aimed mainly at beginners, people who are starting out in cryptocurrency and know little or nothing about it. Today's topic: exchanges, what are they for? That's what we're going to see from this little article.
Introduction
To start, here are three blockchains: Bitcoin, Ethereum, and Litecoin. These are three known blockchains. These three blockchains have their own ecosystem, they are all three decentralized and they do not communicate with each other. So, each of these blockchains obviously has its own wallets, what we call "wallets", when you are going to open a "wallet", and well this "wallet" is created on the blockchain. So these blockchains need a place where we can exchange Bitcoin for Ethereum, Ethereum for Litecoin...etc. Well this place is called "an exchange platform".
An exchange is therefore a place where you can exchange your cryptocurrencies. Today, there are a lot of platforms. If you want to have an exhaustive list of platforms, we recommend you to visit CoinGecko. Always choose platforms that have a good reputation, when you have a doubt about a platform then we recommend you not to go there. As always, do your own research. When we talk about platforms like Bitget, this is a platform that you will have absolutely no worries with. Look for exchange platforms that are ranked high on CoinGecko and have a strong reputation. Be very careful with "second zone" platforms that could be very dangerous. Not all trading platforms list the same crypto-currencies. The "biggest" ones list the most cryptos. It's always best to choose a platform that has a strong reputation for trading.
Every exchange has its own strengths; Bitget is proud to say that we are a trusted leader in terms of asset services, security and compliance. In addition to the wide variety of products and services, we have made every effort to provide top-notch customer protection by getting operational licenses in the top regulated jurisdictions - the U.S., Canada and Australia, and at the same time maintaining regular contact with authorities worldwide for constant compliance updates.
Established in 2018, Bitget is among the fastest-growing derivatives exchanges, with US$8.1 billion in average daily trading volume and more than 2 million registered users worldwide. Upholding the mission of Better Trading Better Life, the platform aims to provide global customers with a liberal, ultimate, and fair trading experience, ranging from futures trading to spot trading and digital assets purchasing.
Driven by excellence and creativity, Bitget has launched three first-of-its-kind flagship products – USDT-Margined Futures, Coin-Margined Futures, and One-Click Copy Trade in three years. As a result, Bitget has become the world’s largest crypto copy trading platform, with over 55,000 top traders and over 1.1 million copiers together generating US$650 million in revenue. Bitget is now the world’s fifth biggest derivatives exchange and the world’s largest cryptocurrency derivatives copy trade platform.
What is the role of Bitget?
Bitget is basically there to propose to exchange between each blockchain and between each wallet. For example, if you have Ethereum on your ETH wallet and you want to exchange it for Bitcoin, you will transfer your ETH to the Bitget platform and then convert it into bitcoins (BTC) and then you will be able to send your bitcoins wherever you want to a Bitcoin wallet.
Obviously, as with any exchange platform, when you make a transaction, Bitget takes what is called a "fee". They are relatively small. Read here for more information about Bitget Fees.
Bitget today lists many crypto currencies and it is a place where you will find a lot of cryptos to trade and especially a place where you will find a lot of people to create what is called "volume". Indeed, an exchange platform needs a volume, concretely that means buyers and sellers who are there permanently and who will allow you to buy and sell without worrying thanks to this volume which is generated via all these buyers/sellers.
Conclusion
Finally, here is the Bitget view of the ETH/BTC trading pair so Ethereum vs Bitcoin. This means that you can buy or sell ETH against BTC. You can see that on the right you have what is called "the order book" with in blue the people who buy and in red the people who sell. In the center, you have the price curve and at the time of writing the price is at $1084.49 so 0.054799 BTC for 1 ETH.
Finally, here is the small insert that allows you to place your trading orders:
Sometimes you have a cryptocurrency you want to buy that you may not find on the "big platforms" and so these projects will be listed on so-called "medium" or "small platforms". So be very careful to make sure you don't end up on a platform that might cause you problems. We remind you that it is always very important to be very careful about the security of your cryptocurrencies.
If you are new to Bitget, let’s take a look at this quick video tutorial: How to Use Bitget - The Beginner's Guide.
Don't worry, even if it may seem a little barbaric to you to see all these lines moving, you will understand very quickly and believe us it is not at all complicated. Bitget Academy and our blog are here to explain in detail how it all works.
So we hope this is a little clearer in your mind and we always try to be as simple as possible in our explanations. Of course, we do go into more depth in our blog and in the Bitget Academy about more or less complex elements in order to better understand. Once you've already understood the mechanism, it's not bad at all.
An exchange is a place, usually a website or a mobile application where you can exchange a crypto for another crypto currency. Once you know that, well, you've got it all figured out.
Disclaimer: This article is for educational purposes only and is not intended as investment advice. Qualified professionals should be consulted prior to making financial decisions.
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