The recent investment trends have shifted from traditional investment methods to the advanced crypto culture. The surge in cryptocurrency investment relied greatly on the security and reliability of these exchange services. Nearly 22 million people visit the crypto exchange sites in the United States each month.

If you are well-versed in the blockchain industry, you must have heard about Bitcoin. Surely you would have! But are you curious whether this popular crypto, Bitcoin, is centralized or decentralized? Also, the investors must know new investing terms such as ‘centralized’ or ‘decentralized’ before investing their money into one of the crypto exchanges.

In this context, several reliable and secure sites, such as, can help you invest in various crypto exchanges in the most efficient way. Before you find out the answer to your question, it is important to know the stark difference between the two kinds mentioned above of exchanges and which type you should invest in. Reading this guide will further help you get a better understanding of Bitcoin.

An Overview Of Centralized Exchange

In simple words, centralized exchanges are those operated under a central authority that is liable for managing transactions and holding a ledger. It can also be slated as a three-party setup that assists investors by offering them an easy-to-use interface. Also, the issuing company is responsible for giving any kind of assistance to the users. However, the blockchain industry is more inclined toward decentralized crypto exchange systems. Want to know why? Read below to find out.

What Is Meant By A Decentralized Exchange?


Contrary to the centralized system, a decentralized system has emerged as a comprehensive peer-to-peer strategy. It refers to the kind of crypto exchange wherein the sole authority lies with the investor, and there is no interference from a third-party company.

This latest technology involves a system of users without any authority to resolve the concerns that emerged due to exchanges in the centralized system. This gives you complete ownership of your crypto exchanges, making it the most secure option.

It is a considerable fact that the blockchain industry is mainly based on its key element, i.e., decentralized crypto exchanges. Let us now determine whether Bitcoin, the first crypto, is centralized or decentralized.

Bitcoin: Centralized Or Decentralized?

Bitcoin is referred purely as a decentralized crypto exchange. The use of Bitcoins first surged during the financial crisis, i.e., in 2008. The use of such exchanges was beneficial, especially in nations that had a lack of financial assets. This gave equal opportunities to all the investors, including those willing to invest in other assets.

This was so because, during the financial crisis in the United States, the investors who could not invest in the traditional form of exchanges had no alternative to cash-based transactions. Hence, they continued to lose money.

Bitcoin was therefore created as a solution to establish a global financial system that was not regulated by any central authority, and the investors could easily trade without any restrictions. In this regard, it must be mentioned that the current blockchain industry is predominantly based on DEX.

In the case of Bitcoins, these cryptos comprise both users and nodes involving mining and non-mining. Similarly, Bitcoins consisted of nodes and were accessible to everyone. However, before introducing specialized chips for mining bitcoins, people tended to use GPU chips for crypto mining. Further, the demand for any kind of change can be put forward before the operating community of Bitcoin.

In the blockchain industry, the degree of decentralization of DEXes includes considering the number of validators responsible for the stakes distribution. For example, Binance Coins has distributed its stakes to over 21 validators. If you are willing to invest in Bitcoin or any other crypto, you must first understand how to calculate the degree of decentralization of that crypto.

However, before analyzing which sort of exchange you should invest in, it is necessary to know the key benefits of investment in DEX. Read this guide further to learn about the same.

Benefits Of A Decentralized Exchange


The benefits of DEXes are numerous. We have identified some of the significant benefits of DEXes assisting investors.


In a DEXes, there is absolutely no risk of crypto theft. Contrary to centralized systems, which are prone to hacking, decentralized exchange systems can be described as ‘impossible to hack’ because the system is interwoven with millions of users, and it would be impossible for a hacker to hack each user. Likewise, in Bitcoins, there are no possible risks of hacking.

Exchange fee:

CEXes charge some percentage as a fee per transaction. Alternatively, you only need to pay a gas fee to make the initial investment in trading in decentralized crypto. Furthermore, this gas fee is generally as low as $0.5 to $1. What’s more? You do not need to perform the KYC or present any identification card to start with the trade.


In DEXes, you do not need to worry about privacy concerns because you do not need a KYC document to start. Added, the transactions provide complete anonymity as opposed to its peer-to-peer exchange system, CEX. You can easily start with the investment without undergoing any identification procedure. Simultaneously, there is no information stored about anyone who performed Bitcoin mining.


What is better than a service offering 100% ownership to you without the involvement of any third party? Bitcoin executes the transaction without the involvement of a central authority, thereby giving complete ownership of the transaction to the trader.

What Should You Invest In: Centralized Or Decentralized?


The answer to this is indeed decentralized crypto, for example, Bitcoin. This is because a decentralized system has numerous benefits, such as ease of investment, sole ownership over your transactions, and a minimal gas fee. Not to forget, a decentralized system is often considered the safest and has been termed as a technology that is almost impossible to hack.


Bitcoins were the first decentralized crypto exchange systems that allowed transactions without a central authority. Besides, the significant benefits mentioned above make it an ideal choice for investors to trade. Several reliable and trustworthy apps assist you in entering the dynamic world of cryptocurrency by trading in Bitcoins.