The world of Challenge (decentralized economy) may seem obscure for crypto newbies. Some observers claim that centralized exchangesintuitive and easier to access, could constitute a gateway to DeFI.
Ease of use and wide range of products available on centralized exchanges make them gateways to DeFi
Centralized exchanges are generally easier to use for beginners, especially thanks to their user-friendly and intuitive interfaces. They offer great liquidity for many assets, which also makes it easier to exchange more traditional cryptocurrencies for DeFi tokens, which are also present on centralized platforms.
Centralized exchanges actually offer one wide range of cryptocurrencies, including ERC-20 tokens used in DeFi. This allows users to their first steps various DeFi projects.
Centralized exchanges facilitate the process of trading and managing assets. This therefore makes life easier for beginners who are not not yet familiar with more complex DeFi protocols.
Finally, most centralized exchanges also allow users to buy cryptocurrency directly. with fiat currency (trust currency – euro, dollar, etc.). This function is often absent from DEX (decentralized exchange platforms)which makes entry into DeFi more difficult for newcomers.
According to the CEO of dYdX, centralized exchanges and decentralized exchanges are not in competition
While dYdX, semi-centralized exchange platform recently launched the testnet of version 4 of its “dYdX protocol”, which tends to make the platform completely decentralized, its CEO, Charles d’Haussydecides on his vision for exchanges at Cointelegraph’s microphone:
“The [les exchanges centralisés] are not competitors to the dYdX protocol, frankly speaking. I think they do their job well. They supported the market early. We must not forget that perpetual futures contracts were invented by BitMex, which is a centralized entity.”
According to the CEO, the industry is full of transition phase. He reminds, however, that there is room for centralized exchanges as well as decentralized exchanges, as the two units can thrive on opposite sides, without necessarily competing.
“I can certainly imagine a world where a centralized entity with KYC [Know Your Customer – vérification d’identité] and customer risk profiles […] will offer internal trading platforms. Maybe it will give its customers a better experience [par rapport] to DeFi while offering a simpler connection between the centralized platform and DeFi.”
According to Charles d’Haussy, this practice is comparable to traditional banks that offer multi-services.
In summary, the director of dYdX believes that centralized exchanges could serve as entrances to decentralized exchanges and by extension DeFi, in the more or less near future. Centralized exchanges and DeFi could actually collaborate in one “positive ecosystem”.