Semi-centralized exchange opens doors to its innovative Web3 ecosystem for trading and governance
In the rapidly evolving world of cryptocurrency, significant changes have occurred within the crypto sector, particularly concerning crypto exchanges, over the past few years. Centralized exchanges (CEXs) have experienced remarkable growth, transforming into industry giants. These platforms have played a vital role in facilitating the buying, selling and trading of various cryptocurrencies, serving as intermediaries between traders and the digital asset market.
However, amid the remarkable growth and success of centralized exchanges, the crypto sector has also witnessed shake-ups that have had a profound impact, eroding the trust in these platforms. One notable example reverberating throughout the industry was the collapse of FTX, a prominent centralized crypto trading platform.
As a result, many traders flocked to decentralized exchanges (DEXs) that offer a peer-to-peer trading environment where users retain control over their funds and eliminate the need to trust a centralized authority. However, they also have several disadvantages compared to their CEX counterparts, like lower liquidity, more complex and less user-friendly interface, slower transaction speeds or higher network fees.
Can the strengths of centralized and decentralized exchanges be combined to create hybrid exchange models? One example is the cryptocurrency exchange Phemex, which is partly centralized and partly decentralized. They are pioneering a new semi-centralized platform model. This approach helps the platform offer traders an efficient and fast trading experience while remaining transparent and secure.
For example, users can prove their specific account’s reserves by implementing a hierarchical deterministic cold wallet system. The exchange’s
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