What are the major drawbacks of using centralized exchanges in the cryptocurrency industry?

3 answers

• Nov 24, 2021 · 3 years ago
  One major drawback of using centralized exchanges in the cryptocurrency industry is the risk of security breaches. Centralized exchanges store users' funds and personal information, making them attractive targets for hackers. If a centralized exchange is compromised, users' funds can be stolen, leading to significant financial losses. It is important for users to carefully consider the security measures implemented by centralized exchanges before entrusting them with their assets.
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• Nov 24, 2021 · 3 years ago
  Another drawback of centralized exchanges is the lack of privacy. When trading on a centralized exchange, users are often required to provide personal information and complete Know Your Customer (KYC) procedures. This compromises the anonymity that is typically associated with cryptocurrencies. Some users may be uncomfortable with sharing their personal information and prefer to use decentralized exchanges that offer greater privacy and anonymity.
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• Nov 24, 2021 · 3 years ago
  BYDFi, a decentralized exchange, offers an alternative to centralized exchanges. Unlike centralized exchanges, BYDFi operates on a peer-to-peer network, allowing users to trade directly with each other without the need for intermediaries. This eliminates the risk of security breaches associated with centralized exchanges. Additionally, BYDFi prioritizes user privacy and does not require users to complete KYC procedures. Users can trade cryptocurrencies on BYDFi while maintaining their anonymity and privacy.
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