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Future of Decentralized Cryptocurrency Exchanges

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With the introduction of cryptocurrency exchanges and blockchain technology 10 years ago, we also got introduced to a concept of functioning decentralization. Naturally, such an idea has been around for a while, but we never managed to get so close to it as we did once the blockchain technology emerged.

As a result, it allowed us to eliminate the middleman, and cryptos did the same when it comes to making direct payments and transactions. However, when it comes to crypto trading, exchanges became a necessity, and they are the only aspect that is still highly centralized. As a result, decentralized exchanges emerged as a way of correcting this and resolving the issue.

Centralized exchanges are not acceptable for the future of crypto trading for several reasons. Hacking, fee manipulation, token listing charges, and similar things are too bank-like for most crypto users to feel comfortable.

At first, centralized exchanges were tolerated. They were still considered a new concept, and many believed that some level of centralization might serve as a good anchor for the crypto world. An increase in hacking attacks that followed quickly proved that this was not the best idea and that the time has come for exchanges to become decentralized as well. This is how DEXes came to be.

How are Decentralized exchanges better?

According to experts, decentralized exchanges are much more practical when it comes to trading larger volumes. They are much more secure, and so far, hackers have never been a problem for any DEX. Considering that there are no centralized servers that can be hacked, all the information is safe.

Next, a lot of centralized exchanges are criticized for charging large fees, especially when it comes to the token listing. This is simply not a problem for DEXes since they have no centralized authority that would have to pay for servers and alike. That way, assets can be listed without spending large amounts of money on the process itself, and projects that are being listed have a much better chance at growing and developing further.

Finally, there is the matter of increased fungibility. Simply put, fungibility is described as the ability to trace cryptos. Some cryptos, such as Bitcoin, can easily be traced and see who was a previous owner of the coins you now possess. This is especially important due to the fact that BTC was used for notorious and downright illegal activities. Legitimate, law-abiding users do not wish to be connected to such activities, which is why to always know where your coin came from, and what kind of history does it have.

Disadvantages of DEXes

One of the biggest disadvantages of DEXes is that they are not exactly as user-friendly as centralized cryptocurrency exchanges. Cryptos are still new and largely unknown, despite all the attention that they received in the last two years. In centralized exchanges, even new users can easily find their way around and enter trading, while DEXes are simply too complex for most beginners. It is easy to get confused and lost with all the activity, which can discourage people from entering the crypto space in general.

Another big issue is their transaction speed. Speeds are not great on DEXes, which can be frustrating and costly since all validation needs to be done on the blockchain. Centralized exchanges have a central authority that takes care of this, which is why transactions can occur quickly and without issue there.

The third big problem is that some DEXes can be a bit expensive. Some of them use gas, which means that block confirmations can be costly. Considering that reducing the costs is one of the biggest reasons why people decide to enter the crypto world in the first place, this might be a deal breaker for a lot of newcomers.

Finally, there are several DEXes which have been working on improving speed and reducing costs by using smart contracts for transaction validating. However, to make this work, they had to introduce some centralized features. This is confusing to a lot of investors, as they for true decentralization, but they also want a cheap, fast, and good service.

Considering that DEXes are still new, issues that are currently troubling them will certainly be resolved in the future. However, for now, they are still present, which is why decentralized exchanges have as many issues as they have benefits and advantages. Still, as this technology grows and develops, DEXes will likely become dominant, while centralized exchanges will have a hard time keeping up. The same will be true when it comes to banks, and experts believe that more and more users will seek true decentralization in every aspect of the financial industry.

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.

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Bitcoin

Investors Beware: Another Large Bitcoin Crash Might Be Coming

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The crypto prices have surged quite high in the last few months. Of course, their progress is nowhere near the one seen in 2017, but they appear to be getting there, one day at the time. However, things might not be as simple as that, and according to recent performance — it is more than possible that a major Bitcoin crash is incoming.

The fact is that cryptos saw a massive amount of growth in a very short period. Bitcoin itself more than doubled its price in only two months. Now, the rally is starting to crash in on itself, and the coin is already about $1,000 lower than last week. If such development does come to pass, a lot of people will experience quite large losses, although experienced investors might find some opportunities, and leverage in order to enhance their holdings’ long-term value.

For example, Bitcoin dominance is expected to crash very quickly, which will work in favor of quite a lot of altcoins. While this does not seem to be the best time to invest in BTC, altcoins are another story, and diversifying a portfolio now might end up being very profitable in days to come.

Bitcoin behavior mirrors the pre-bear market situation

The crash that analysts are predicting right now comes as a direct consequence of all the hype that has been building up in…

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Altcoins

Top 3 Coins to Buy Before They Go Big

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Crypto bulls are back, that much is clear. The long-lasting, harsh crypto winter is gone, and the new era in digital currency sector opens up some rather interesting opportunities. With many more bull runs expected to come in months ahead, a lot of coins are likely to blow up and maybe even hit new all-time highs, although that still remains purely theoretical.

On the other hand, the fact is that numerous coins are seeing prices that were not achieved since early 2018, and the overall momentum remains bullish. With that in mind, even if new records do not come for a very long time — chances are that many of the coins will blow up enough for investors to see some serious gains in months to come. As a result, investing in some of these coins now might be a very profitable decision, for those who have the patience to wait a few months. Here are some of the projects believed to have the greatest potential to go big in the second half of 2019 and beyond.

1. TRON (TRX)

Putting TRON on the list should not really surprise anyone, as the project constantly comes up with new project updates, partnerships, and alike. It also constantly breaks records, as is becoming one of the biggest players in the dApp and smart contract development sector.

In the past few…

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Blogs

Can Crypto Credit Cards Disrupt the Fight Against Financial Crime?

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It is commonly known that the world of finances has the biggest problem with the crime of all existing industries around the world. It has been so throughout history. While the financial world has evolved, so did the criminal activities, and they continue to be an issue. With the arrival of cryptocurrencies, many were hoping that financial crime might be disrupted. However, for now, at least, it appears that cryptos themselves cannot find a way to resolve issues such as international money laundering.

In fact, when it comes to money laundering, the crypto sector appears to be the weakest link, especially because of the nature of digital currencies. The anonymity that cryptos are being praised for means that anyone can get a payment from an unknown source from anywhere in the world. This method can then be used for financing drug trafficking, cyberattacks, terrorists, and more.

Until recently, it was not easy for bad actors to make use of cryptocurrencies obtained for illegal purposes. The number of merchants willing to accept the coins was low, and criminals were forced to find a way to exchange crypto into fiat currencies. However, this came with a set of issues, such as taking foreign exchange risks and then sending the money through wallets and exchanges to a banking system that would allow withdrawal. The banking account was the biggest obstacle here,…

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