Why are centralized exchanges still dominating the crypto space?

[lavara]

The share of centralized exchanges still remains very high. But de-centralization is inevitable.Centralized exchanges still have many users: they bargain by habit.Who understands that the exchange should not be dependent on one group of people, have good functionality and be safe, he will choose a decentralized one.

[cunguks]

The share of centralized exchanges still remains very high. But de-centralization is inevitable.Centralized exchanges still have many users: they bargain by habit.Who understands that the exchange should not be dependent on one group of people, have good functionality and be safe, he will choose a decentralized one.

if a decentralized exchange has the trust of a trader it will definitely be an attractive place, where security and convenience in trading will be more value than exchange. I think what is still believed is the long-standing exchange of decentralization. for those who are new, there must be a lot of consideration.

[naufals4]

Ever since Bitcoin launched back in 2009, the rise of centralized exchanges has been inevitable. A few years later, and now the whole crypto market is dominated by centralized exchanges. While there have been many alternatives to the solution (such as decentralized exchanges), people are still performing trades at centralized entities.

Now the real question is why this is happening, since after all, Satoshi intended Bitcoin to be free from middleman or third parties? Depending on an exchange or custodian, greatly defeats the purpose of true decentralization. Knowing how oppressive some governments are, it'll be easier for them to stop usage of crypto whenever they want to by just targeting centralized exchanges.

Nonetheless, what are your thoughts about this?

in my opinion people still use the centralized exchange because it is more popular and the accounts we have are protected by the company so security is higher than the decentralized exchange. but actually the decentralized exchange can also be as long as we store our account like a private key safely, the security is much higher and simpler

[Amalker]

I would love to use DEX, but for now, there is no such DEX with really convenient UI, sufficient operation speed and liquidity. But I guess we will see fast DEX with all such features onboard in near 1-2 years.

[fasdorcas]

I know that decentralized exchanges has more security than centralized exchange, since there is no database where transactions are being stored but rather carried out on the blockchain directly.

The only problem I have with decentralized exchanges id that they don't have a user friendly platform, I as a dev found it hard to make use of the platform how much more a newbie in the crypto space that don't really understand how the crypto market works.

[matveyeff]

I know that decentralized exchanges has more security than centralized exchange, since there is no database where transactions are being stored but rather carried out on the blockchain directly.

The only problem I have with decentralized exchanges id that they don't have a user friendly platform, I as a dev found it hard to make use of the platform how much more a newbie in the crypto space that don't really understand how the crypto market works.

I think this situation is temporary. Someday we will see a convenient decentralized exchange, where beginners will can trade without any problems.

[bartusv]

Centralized exchanges won the competitions as decentralized exchanges are still not user friendly,
having no customer services, can be hacked as well etc. Hopefully this will change in the future.
Waiting for the Binance DEX launch this month.

[Abiky]

Apart from better performance and more features, I think the main reason is because the centralized exchange provides an option to trade to fiat and withdrawal to local bank accounts.
Some large exchanges often even do various ways to attract traders to trade in their exchange such as promotions, giveaways, trading competition etc. Thus, the interest of traders is more active in the CEX than DEX.

That's certainly true, mate. Undoubtedly, centralized exchanges have greater performance, and user friendliness than their decentralized counterparts. Even with all the downsides existent within centralized exchanges (like hacks, theft, and lack of privacy), people seem to trust them more than decentralized ones. The reasons for this are obvious, since decentralized technologies are not proven or tried and tested.

Because of this, I believe that centralized exchanges will continue to dominate the crypto space for a very long time. Still though, decentralized exchanges will not cease to exist as they're viable alternatives against centralized ones. Instead, both decentralized and centralized exchanges will live alongside each other for many generations.

Nonetheless, what's important is that crypto stays as decentralized as possible. Knowing that centralized exchanges are subject to government regulations, countries can restrict or ban crypto trading completely, resulting in less adoption within the mainstream world. If this happens, then decentralized exchanges would be the only way to go towards switching from one coin to another. In the end, it's all a matter of adoption whenever both approaches (centralized and decentralized) will survive in the future. Just my thoughts

[LUCKMCFLY]

Ever since Bitcoin launched back in 2009, the rise of centralized exchanges has been inevitable. A few years later, and now the whole crypto market is dominated by centralized exchanges. While there have been many alternatives to the solution (such as decentralized exchanges), people are still performing trades at centralized entities.

Now the real question is why this is happening, since after all, Satoshi intended Bitcoin to be free from middleman or third parties? Depending on an exchange or custodian, greatly defeats the purpose of true decentralization. Knowing how oppressive some governments are, it'll be easier for them to stop usage of crypto whenever they want to by just targeting centralized exchanges.

Nonetheless, what are your thoughts about this?

It is very understandable that Satoshi did not want this, he wanted everything totally decentralized, even the Exchanges, the main reason I think that there are these Centralized Exchanges, it is for the security that it offers to the Traders, the confidence and security that comes from having the Safe money and not being targeted for possible scams is what many operators seek.

Everything lies when money is converted into Crypto Money Fiat, there everything changes, because it is when it is taken from the digital to the real. In addition, it relies more on Level 1 Exchanges, since many operators have been stripped of their balance sheets because they trust Exchanges without any type of reliability.

[andor.gellenhidi]

Because now I see how many cryptocurrencies are already covered by centralized authorities. You have to understand that people have invented decentralization in order to avoid all this collapse, therefore, the centration can be called a relic of the past.

[cahbagus555]

Ever since Bitcoin launched back in 2009, the rise of centralized exchanges has been inevitable. A few years later, and now the whole crypto market is dominated by centralized exchanges. While there have been many alternatives to the solution (such as decentralized exchanges), people are still performing trades at centralized entities.

Now the real question is why this is happening, since after all, Satoshi intended Bitcoin to be free from middleman or third parties? Depending on an exchange or custodian, greatly defeats the purpose of true decentralization. Knowing how oppressive some governments are, it'll be easier for them to stop usage of crypto whenever they want to by just targeting centralized exchanges.

Nonetheless, what are your thoughts about this?

Centralized exchange offering more good User Interface and speed of transaction. Decentralized exchange is good but trading volume not too big to move the price and i think many people trade in crypto, not for long term, its more faster for trader using centralized exchange

[imstillthebest]

snip ...

Centralized exchange offering more good User Interface and speed of transaction. Decentralized exchange is good but trading volume not too big to move the price and i think many people trade in crypto, not for long term, its more faster for trader using centralized exchange

im a regular user decentralized exchange and i also use a couple of centralized exchange .  id say not all dex exchange are bad or have a bad interface  . fork delta for example  , fd is simple and clean  . its fast compare to etherdelta but the problem is the volume  . fd and other dex exchange have a low volume compare to the centralized one's   .

[sehoon]

It is probably because centralized exchanges offer better services than the decentralized exchanges. And most of the projects wants their coin to be listed on them because of this. Decentralized exchanges are slower when it comes to processing trades. Centralized exchanges also knows how to attract more customers

[craslovell]

This almost makes me think of a mob type of mentality. The leading exchange has changed hands so many times. So many exchanges have fallen from grace. Look at Poloniex since it was purchased. It's not in the depths of the list as far as volume goes and used to be #1 in the world.

[Abiky]

im a regular user decentralized exchange and i also use a couple of centralized exchange .  id say not all dex exchange are bad or have a bad interface  . fork delta for example  , fd is simple and clean  . its fast compare to etherdelta but the problem is the volume  . fd and other dex exchange have a low volume compare to the centralized one's   .

That's certainly true, mate. Centralized exchanges are much easier to use, and faster than decentralized exchanges. There's no doubt in that. But I believe that both will serve their different purposes in the mainstream world. For people who prefer ease-of-use and high liquidity, centralized exchanges would be the most viable option to go. However, if you prefer greater security, reliability, and censorship-resistance, then decentralization would be the only path to take.

The main reason why centralized exchanges have been so dominant since crypto's beginning, is because of the ability to become regulatory compliant. When something undesired happens in a centralized exchange, people can feel confident that their funds are protected by the government. Legal action can be taken, as there's a single authority in charge of everything. However, that's not widely possible in a decentralized exchange since you're the only person in charge of your funds.

Nonetheless, Satoshi intended that crypto would be as decentralized as possible. But, with centralized exchanges coming into play, his/her vision becomes more distant every day. Just my opinion

[trimulia]

of course, because the centralized exchange has very high security, so cryptocurrency theft more less unlike decentralized

[naturerock]

Centralized exchanges are fine, people make a big deal about decentralized ones but as long as you find an exchange with good reviews and fast service you'll be fine.  I prefer to have someone be held liable if something goes wrong.

[DreamStage]

Centralized exchanges are still dominant at the crypto space due to their easy adapation on the current market's state.

Each provides their unique security system, fees, payment options, Web / Application UI and much more that makes it exclusively than a decentralized exchanger.

All depends on the companies mindset on providing different goals in the long term or from a must have change due to market's influence.

[olamidey]

There are lots of factors that can be responsible for this. Security is one of them. Most traders don't want to enter their wallet details on to the DEX platform incase they forget to log out and it gets hacked. It could also be confusing at times. The second reason is volume. CEX have enough volume which all the DEX put together can not match. Sometimes you have to keep waiting til your order is filled up.

[Serve20]

I think the main reason is because there's no in existence of any decentralized exchange that can operate across many blockchain protocols for execution multiple transactions and this is the reason why most of the decentralized exchange are one protocol exchange thereby limiting its capacity