Blockchain technology was created to be decentralized and community-orientated. However, many exchanges have fallen into a centralized trap and are owned by third parties. That’s why many are discussing the topic: a centralized vs decentralized exchange.
But things are rapidly shifting with a decentralized blockchain exchange. These exchanges solve the problems caused by centralized exchanges by creating a peer-to-peer marketplace. You have full ownership of your funds here.
If you have recognized the benefits as well, you’re probably looking for the best-decentralized exchange for your crypto holdings. Here are 5 things you need to consider before making a decision!
1. Do Your Own Research Well
If you’re looking for a great decentralized exchange, it’s useful to listen to your friends, read articles, and even look into the representatives from the exchange. However, nothing is more important than doing your own independent research and forming your own judgments.
Take the time and effort to really dive into your choices.
2. Security Is the Most Important
Luckily, decentralized exchanges already offer better security than centralized exchanges. There are no complicated KYC requirements in place. They are not controlled by one entity. Smart contracts control the transactions. They were introduced for this reason! That’s basically why they were introduced in the first place!
However, you need to still ensure that you are choosing a genuine exchange service. Otherwise, hackers can access your money. You should also transfer your money to your wallet as soon as the transaction is complete.
3. Make Sure It’s Really Decentralized
Unfortunately, some exchanges are not fully decentralized. Even though they say they are. Here’s how decentralized exchanges work: there are numerous servers across the world so that your data remains safe. This way it’s almost impossible to get hacked.
Be mindful of how the exchange is truly set up.
4. Sometimes Less Well-Known Is Better
Even though you will probably search for the most well-known exchanges, this is sometimes a disadvantage. The most well-known exchanges actually limit the currencies they trade. You are more likely to find better investment opportunities on less-known exchanges.
5. Don’t Choose With Your Emotions
When you are searching for an exchange, you should really stick to the facts. If you make emotional decisions (e.g., I really like the people who also use this exchange), you put yourself at risk and will make the wrong decision. Before you research your options, leave your emotions at the door, and write down the cold, hard facts.
This way, you will make the best decisions for your future investments. Pro tip: manage and track your spending with a tool like www.swapfol.io/.
There Is No Best-Decentralized Exchange
The search for the best-decentralized exchange is never over.
This is because the field of cryptocurrencies changes incredibly fast. You need to remain vigilant and monitor the performance of the currencies and exchanges. You need to stay updated on the latest news for your investment. By using this information, you can make continuous decisions about where and how to trade your cryptocurrency.
We have a whole set of useful articles about crypto. Check them out for more tips, tricks, and advice!