Why transfer a deposit to a decentralized exchange

Recently, more and more often we hear about lawsuits against centralized cryptocurrency exchanges, among which there are quite serious and positively proven platforms, such as OKEx and Coincheck.

All of them are related to the unfair attitude of trade organizers to the level of security of trading accounts, resulting in either the theft of client funds or accusations of manipulation of trade asset quotations.

All of these problems arise for two reasons: human error and vulnerability to hackers, and blockchain technology was developed to combat their influence.

PROBLEMS OF CENTRALIZED EXCHANGES
Of course, to say that all cryptocurrency exchanges cheat their customers would be completely unfair.

In this article we don’t want to advertise reliable exchanges, as well as anti-advertise those who have shown themselves to be dishonest. In general, there is a lot of information available about all of these exchanges among cryptocurrency traders.

However, speaking about the general reasons why your deposit or trade could be at risk, it should be noted that the disadvantages we describe are theoretically the bottleneck of any centralized cryptocurrency exchange.

FINANCIAL RISKS
Any cryptocurrency exchange can face sudden withdrawal of too many deposits or lack of funds in competition for traders’ sympathies. As a result, when such an exchange closes down, not all traders will be able to get their deposit back.

SECURITY ISSUES
No matter how hard crypto exchanges try, but accumulation of clients funds, even on a few accounts, inevitably leads to finding a hacker who finds access to them.

LACK OF REGULATION
Even if it is insignificant, but still there is a chance that tomorrow organizers of trades will pack their belongings and leave to islands, leaving traders with naked deposits, many trading participants do not sleep well.

And, unfortunately, for the vast majority of the cryptocurrency market, there is no one authority that can help in this situation.

The problems of centralized cryptocurrency exchanges

HOW A DECENTRALIZED EXCHANGE SOLVES THESE PROBLEMS
The very principle of decentralization, which already seems to have been forgotten by the participants of the cryptocurrency market, is fully realized within the framework of decentralized cryptocurrency exchanges.

After all, when you transfer your funds to a cryptocurrency exchange that is fully managed by a blockchain, you are automatically out of the risk zone outlined by the problems listed above.

Any activity you do with your deposit is subject to a distribution registry, with no risk of replay or unauthorized access to it.

Each trade is a separate smart contract that cannot be closed, deleted or corrected without your knowledge. No one can simply withdraw funds that belong to other users from a distribution registry.

These reasons are enough to make your choice in favor of decentralized exchanges, which platforms such as Waves and EOS are already actively joining.