What if CEX do not have BTCs? What is being traded then?

[Mr. Magkaisa]

    -  Storing Bitcoin in an exchange is really high risk, it's still really good to store bitcoin in a hardware wallet, nano ledger or if you don't have it, Electrum is also possible as long as the password is saved, private its key or seed phrase.

If you save bitcoin on an exchange, maybe just make sure it's something like binance that can be trusted somehow. Because of my experience in using it for several years, so far I have not had any problems with it.

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[Hamza2424]

Hahaha funny but good point, so in exchanges the assets you watch are just the numbers based on the database of the centralized trading platform. All the real deposits and assets are stored in the cold storage wallets and corresponding the numbers are updated in the database. I think this is how we work most of the time on trading platforms (CEX) we trade. This is the reason we call them noncustodial wallets.

Remember Not your key, not your coins.

On the other hand, decentralized exchanges (DEX) work to a real level, each and every transaction is a real-time asset and value-based which indicates the legitimacy of the trade. Trade with decentralized exchanges if you are a big trading player because funds custody is more important.