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* Decentralized exchanges (DEXs) stand out for providing greater global access to a diverse array of tokens, offering users a more extensive selection of digital assets.* The integration of a swap feature in many web3 wallets enhances the user experience, allowing seamless facilitation of trades on DEXs directly through the wallet interface.* Security is bolstered when connecting to a DEX using a web3 wallet, offering an alternative to the traditional username/password authentication used in centralized exchanges (CEX).* Automated Market Makers (AMMs) on DEXs present a significant cost-saving advantage compared to the market maker services on centralized exchanges, contributing to the appeal of decentralized trading platforms.* The ability to lock liquidity on a DEX serves as a preventive measure against rug pulls, ensuring a more secure trading environment for participants.* DEXs facilitate the creation of a wide range of trading pairs with ease offering flexibility and diversity in trading options.* While decentralized exchanges have numerous advantages, certain trading strategies, such as shorting or futures trading, may be limited on DEXs compared to CEXs.* DEXs operate in a decentralized manner through smart contracts, ensuring users retain custody of their tokens. In contrast, centralized exchanges hold users&#39; tokens in custody at the exchange, introducing an additional layer of trust and control.* The streamlined process on DEXs eliminates the need for users to open an account, in stark contrast to centralized exchanges that require full verification and approval before trading activities can commence.

Advantages of DeFi (Decentralized vs. Centralized Exchanges)

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