An undisputed fact is the blessings which the creation of cryptocurrencies has been to the world as it has made transactions to be seamless, trustless and unrestricted, an achievement which has eluded the global financial system for long, due to the inability of the fiat currency to be used for stressless payments.
Fiat is no longer able to keep up with the transactional demands of the global population as the world is revolutionizing with the passage of time, through the entrance of improved technologies into the system, that is why a more reliable currency was required to be able to give the world, the full taste of cashless transactions, hence the development of cryptocurrencies.
Basing this digital assets on one of the most revolutionary tools of all time, the Blockchain, makes it superior to the normal fiat currency, giving it features that makes it reliable and seamless, during transactions.
A mere look at the global financial system today, will tell you how far the cryptocurrency has gone in improving the payment system and how rapid it is moving into the different industries, elevating the economy.
For cryptocurrencies to be used effectively, and for the world to harness its power in improving their systems, cryptocurrency exchange platforms are very important.
CRYPTOCURRENCY EXCHANGE PLATFORMS
A cryptocurrency exchange platform is a system developed to facilitate the easy exchange of digital assets to fiat or other digital assets.
It is meant to make cryptocurrency transactions seamless for the global users, in all works of life, as it provides a ready exchange service for anyone who wishes to carry out transactions.
So you see why they are important in the cryptocurrency industry?
They are considered as the hinge of this industry because their role in cryptocurrency transactions cannot be over-emphasized.
Now that you know what a cryptocurrency exchange platform is, and its importance in the cryptocurrency industry, let’s consider the different exchange platforms that we have.
In today’s world, there are two most recognized types of cryptocurrency exchange platforms that have been in play, the first of which is…
THE CENTRALIZED EXCHANGE
Centralized exchange is a cryptocurrency exchange platform that allows for the purchase, sell and exchange of cryptocurrencies under the control of a central system, one which is governed by a central authority.
For a while, this type of exchange has been in use, but sadly, it introduces more risks to the users.
Due to the presence of a central authority governing its activities, it is risky for users who carry out cryptocurrency transactions, seeing as the user’s assets are stored on the exchange which oftentimes get stolen.
This is as a result of the level of insecurity on these exchanges, as they are unable to protect the user’s fund stored on it, thereby giving hackers a full bag, whenever they attack.
Centralized exchanges are also known for the tendency to manipulate the market which also leaves the users with great loss, and the absence of improved technologies in their systems makes the trading in digital assets to be somewhat unreliable because carrying out transactions involving large volumes is extremely difficult.
One other flaw of the centralized exchanges is the lack of transparency, as the users are not aware of how the system is being run and the presence of hidden fees during transactions, which makes the trade in cryptocurrency to be less beneficial for the users.
All these challenges and more, has made the centralized exchanges the less favourite as it is gradually becoming outdated.
A more befitting exchange is needed by the global system, if they are to enjoy the full benefits of the cryptocurrency industry.
DECENTRALIZED EXCHANGE (DEX)
These are exchange platforms which adopt the use of the Blockchain technology, the tool behind the operation of cryptocurrencies, in making cryptocurrency transactions more reliable, than in centralized exchanges.
This type of exchange is said to be more secured as well as reliable because the users are kept in full control of their assets, having full custody of their private keys.
Do you understand what this means?
Security of the user’s fund is assured on a decentralized exchange because hackers will be unable to have access to the funds and even their personal records right there on the system, are completely protected.
Through its use of the Blockchain technology, it not only guarantees the security of transactions, but also makes every operation on its system completely transparent, recording them on the Blockchain, where it is available for review, by the users.
Decentralized exchanges are fast, cost-efficient, secured and reliable.
But the major issue is that nearly all the supposed decentralized exchanges still keep some components of centralization, making it difficult for trustless transactions to be achieved in the crypto space, and most of the decentralized exchanges today, are still restricted by the limitations of the Blockchain technology, which they adopt.
In order to finally get a fully decentralized and reliable cryptocurrency exchange platform, a sophisticated Blockchain that isn’t lacking in any way, is required.
MEET THE ALGORAND BLOCKCHAIN
ALGORAND BLOCKCHAIN is a cutting-edge technology in the Blockchain industry, that is fully equipped to facilitate the development of different decentralized applications and also create ease of payment across the different systems of the world.
It is a decentralized, open-source, Permissionless Blockchain, that creates a borderless economy and drives scalability, decentralization, transactions finality as well as security, through the use of its unique Pure Proof-of-Stake (PPOS) consensus.
This technology is adequate and efficient to make cryptocurrency transactions to be more beneficial, faster, secured and reliable as it helps create completely decentralized exchanges.
FEATURES AND BENEFITS OF THE ALGORAND BLOCKCHAIN IN THE CREATION OF DEXs
The Algorand Blockchain is not restrained by the limitations of other Blockchains, and with its great features, it is able to birth flawless decentralized cryptocurrency exchanges.
● SUPPORT FOR DAPPS: The Algorand Blockchain is designed as a building block for all types of decentralized applications including fully decentralized exchanges.
DEX can now become a reality in the crypto space, with Algorand, since it possesses all the tools needed to efficiently build them.
● SCALABILITY: Since the Algorand Blockchain is scalable, it’s exploitation by any system is easy and so it can easily be adopted by already existing exchanges, who want to improve their services by upgrading their system.
The scalable nature of Algorand allows these systems to incorporate it into their framework, producing fully decentralized exchanges.
● SECURITY: Algorand is developed to be secured, thereby making any system that uses it to be equally secured.
That is what every decentralized exchange needs, a great level of security, and that’s exactly what they will get with the Algorand Blockchain.
● SPEEDY AND CHEAP TRANSACTIONS: Due to the state-of-the-art technology used in developing the Algorand Blockchain, every transaction is carried out with a very high speed, irrespective of the volume as opposed to the regular exchange platforms, every exchange built on the Algorand Blockchain is fast in executing transactions and cheap, as there is no need for middlemen and no hidden charges for using the system.
Algorand Blockchain is the standpoint for the development of DEXs and other decentralized applications, owing to its improved framework and technology.
Cryptocurrency exchange has become easier for many systems which leverage the Algorand Blockchain to build its exchange, giving room for seamless cryptocurrency transactions.
Some centralized exchanges are already adopting the use of the Algorand Blockchain to improve their performance.