Centralized and Decentralized Exchanges

February 8, 2017
decentralized and centralized exchanges

In the wake of the disaster caused by some centralized exchanges that have failed to secure their customers’ funds, decentralized exchanges are gaining popularity. Decentralized exchanges offer a valuable service for tech savvy users that can circumvent all the difficulties presented by these trading platforms, however, they lack the commodity and special features that less technical users and traders require. Furthermore, decentralized exchanges lack user support services. This means that if the user makes a mistake, he is the only one to be responsible for it. The platform doesn’t offer any support in such cases. Furthermore, the liquidity and market depth of decentralized exchanges is quite low – for the reasons mentioned above.

Bitsquare, a decentralized exchange that uses 2 out of 3 multi-signature wallets and arbitrators to ensure the trade is carried out in a semi-trustless environment, is an example of such an exchange as it allows users to trade Bitcoin without the need to to give up the control of your coins and without the need to register an account or provide any private information about yourself. However, Bitsquare has many technical drawbacks, as it does not provide users with any sort of advanced features like margin trading, lending, analysis tools, and so on. Furthermore, Bitsquare is 100% decentralized, meaning that order matching is hosted by the user, therefore the user must be online to have his order broadcast and for the trade to take place.

The OpenLedger for example, an exchange built using Bitshares technology, allows users to buy and sell several crypto assets without the need to be online as the order matching process is done on the Bitshares blockchhain itself, however, Bitshares technology also does not allow these special features like trading tools and margin trading. Furthermore, all crypto assets listed are either Smart Coins (Market Pegged Assets) or User Issued Assets, meaning that when you transfer Bitcoin or Ether to the exchange, you’ll be sent a user issued asset issued by OpenLedger. This assets can also be withdrawn for the cryptocurrency they represent.

Despite providing a valuable service to the crypto community by allowing users to enjoy the trustless and private nature of cryptocurrencies themselves, decentralized exchanges are still years away from being fully functional.

While we understand the value of these exchanges, we also understand the need for a high level features and the ease of use that can only be found on a centralized service.

Exscudo embodies all of the features that advanced traders and less technical users require. It’s an easy-to-use, fast, legal, and secure way to access the cryptocurrency market for every person with access to the Internet and credit card. It provides a digital finance marketplace for beginners and professional traders, financial institutions and institutional investors alike, with advanced trading tools for professionals that are as easy to operate. It allows users to connect their digital assets to a debit card and to use them directly anywhere, and it provides a solution for merchants that are looking to accept cryptocurrencies. Despite being a centralized service, users can enjoy a built-in decentralized messenger for financial transaction support, as well as a wallet with decentralized transactions support – both of these functions in one mobile app.

Exscudo uses its own distributed network called EON, which allows users to make seamless transactions between the Exscudo exchange and all its partners and to manage accounts from the Exscudo platform itself. EON is the fuel on which Exscudo runs and it allows the issuance of our own tokens “EONs”, so that investors are able to track their investments and view all operations within the platform.

Furthermore, Exscudo is 100% compliant and it provides top notch security features to protect user funds from malicious actors.

Latest news