After hearing about FTX’s financial troubles, crypto investors have lost all trust in centralized exchanges. They don’t feel comfortable leaving their crypto money in the hands of others. This lack of trust, along with worries about liquidity and safety, has caused a big increase in activity on decentralized exchanges. These exchanges allow investors to trade crypto directly, without needing of any centralised authority. And that’s not all!
Many decentralized exchanges also offer exciting DeFi features like yield farming, staking, and loans. DEXs are all the rage once again! You see, centralized exchanges require you to give up control of your assets, meaning you have no say in their security if there’s a hack or scam. That’s why decentralized exchanges, where you keep control of your assets, have become super popular and are gaining momentum in the world of crypto trading.
In this article, I’ll be revealing the top decentralized exchanges of 2023. Before that, let’s understand difference between centralised exchanges and decentralised exchanges.
Centralised Crypto Exchanges vs Decentralised Crypto Exchanges: Main Differences
Centralised crypto exchanges are platforms operated by a company or organization that acts as a middleman between buyers and sellers. They have control over the exchange process and store users’ funds on their servers. This setup provides convenience and liquidity but also poses risks, such as hacking or fraud. For example, FTX, Crypto.com, Binance.
Decentralised crypto exchanges, on the other hand, operate on a peer-to-peer network, without a central authority. They allow users to trade directly with each other using smart contracts, eliminating the need for intermediaries. Decentralised exchanges provide greater privacy, security, and control over funds since users retain ownership of their assets. However, they may have lower trading volumes and limited features compared to their centralised counterparts. For example, Uniswap, Pancakeswap.
Here’s a table comparing centralised crypto exchanges and decentralised crypto exchanges:
|Operated by a company or organization that acts as a middleman, controlling the exchange process
|Operate on a peer-to-peer network without a central authority, giving users more control
|Funds are stored on the exchange’s servers, making them vulnerable to hacking or fraud
|Users retain ownership of their funds and have greater security since they are not stored on a central server
|Often require users to provide personal information for verification purposes
|Offer greater privacy since they do not require extensive personal information
|Tend to have higher trading volumes and greater liquidity
|May have lower trading volumes and limited liquidity compared to centralised exchanges, but in some cases, decentralised exchanges could have a higher trading volume
|Generally user-friendly interfaces and offer a wide range of features
|Can be more complex to use and may have limited features compared to centralised exchanges
|Recommended for newbie crypto investors
|Recommended for advanced traders
Top Decentralised Crypto Exchanges in 2023: July Edition
Uniswap: Recommended Decentralised Crypto Exchange for Spot Trading
Uniswap is like a super cool exchange on Ethereum where you can swap tokens with other people directly, without any middlemen getting in the way. It’s all thanks to this thing called the AMM model, which basically means that smart contracts make the trades happen.
Uniswap is one of the biggest decentralized exchanges out there when it comes to how much trading is going on. Over $1.4 trillion worth of cryptos has been traded on Uniswap since it started!
At first, Uniswap was all about Ethereum based tokens only. In fact, when a brand-new ERC-20 token comes out, it often chooses Uniswap to be its very first place to trade. However, it is now a multichain platform. Users can trade on multiple blockchain like Ethereum, Arbitrum, Polygon, BNB Chain, Celo, and Optimism.
Uniswap prioritises trust and freedom to another level. It isn’t just permissionless, but it also runs on these awesome liquidity pools. These pools let anyone create a market by putting in two different tokens. Whenever someone trades those tokens, the pool owner gets a 0.3% fee. Each pool always has an equal value of both tokens, so there’s never a shortage of one or the other.
dYdX: Recommended Decentralised Crypto Derivative Platform
dYdX is another decentralized exchange that runs on the Ethereum blockchain. What’s really neat about it is that you can do margin trading with all sorts of cryptocurrencies like Bitcoin, Ethereum, Solana, Polkadot, and more!
We think dYdX is the absolute best decentralized exchange for trading crypto derivatives. They specialize in something called perpetual contracts, which essentially are like futures contracts for cryptocurrencies, but without an expiration date. That means you can totally speculate on the future direction of cryptos without actually owning them.
dYdX offers leverage trading, which allows you to borrow crypto to amplify your trading power. With dYdX, you can get up to 20X leverage which is perfect for those high-risk traders looking for some serious action.
If you supply your capital on the platform, you actually earn interest on it, even while you’re actively trading. It’s like having your money work for you in the background.
Plus, dYdX also have spot markets, which means you can seamlessly convert between different supported assets. dYdX is right up there in terms of trading volume, just behind Uniswap. So you know they’re a big player in the game.
Now, let’s talk about OKX DEX, which is an efficient decentralized exchange powered by OKX’s very own blockchain called OKC. If you are not aware, OKC is a set of open-source public chains that are all about making big commercial applications possible.
The OKX DEX focuses mainly on giving you this super secure and non-custodial trading platform that knows no borders. What’s noteworthy about this DEX is that it supports not just one or two, but a whopping 15 different blockchain networks. That means you can do cross-chain trading like a pro. Additionally, the OKX DEX believes in keeping everything transparent.
They clearly show you all the different DEX options in order of price. So you know exactly what you’re getting into.
Here’s how it works: you just connect your wallet to OKX DEX, and then you let them know which tokens you want to swap. Boom!
In a matter of microseconds, OKX will show you which DEX has the best price for your trade. OKC’s blockchain aims at providing a better infrastructure than Ethereum. They’re all about making things faster and more dedicated to things like dApps, DEXs, and other cool blockchain products.
Next on the list is Curve Finance. It’s this super handy DEX that lets you trade all sorts of cryptocurrencies and stablecoins on the Ethereum blockchain, and just like Uniswap, it doesn’t rely on an order book.
The great thing about Curve is that its top offerings include speed, efficiency, and user-friendliness. They really want to make your trading experience smooth and hassle-free.
Curve Finance was launched in 2020, and has got these awesome features called token swaps and liquidity pools. They support around 11 different blockchain networks and as a result allow you to trade thousands of different tokens.
Now, here’s what makes Curve stand out even more: they’re one of the best decentralized exchanges when it comes to low fees.
On an average, Curve Finance charges a tiny 0.04% fee for token swaps. That’s way lower than what you might find elsewhere. Oh, let’s not forget about their governance token, CRV which provides liquidity to their asset pools.
1inch is another one of those DEX aggregators in Ethereum’s DeFi world. it boasts of a really clever algorithm that helps it make transactions secure and cost-efficient. How does it do that? Well, it sources its liquidity from multiple liquidity pools.
Before each transaction, 1inch scans through multiple DEXs, so that you, as a user, can get the best prices when buying tokens. And here’s something even better: the platform has its own liquidity pool where you can stake your tokens and earn rewards in their native token, 1INCH. It charges no additional fees, and as a result, you can trade without worrying about extra costs eating into your profits. 1inch isn’t just limited to one blockchain network. Oh no, it’s available on multiple networks.
Plus, if you acquire the CHI gas token on 1inch, you’ll even get a significant reduction in the cost of your transactions. The DEX also offers more advanced options. You can actually place limit orders, which means you can execute a token swap once an asset reaches a certain price. They’ve got all the goodies to make your trading experience top-notch.
PancakeSwap, unlike a lot of other options on this list, is a decentralized exchange that operates on the Binance Smart Chain (BSC), which is this smart contract ecosystem hosted by the world’s biggest crypto exchange. PancakeSwap is like the go-to place if you want to trade altcoins on the BSC network. However, besides BEP20 tokens, you can also trade tokens of Ethereum, Aptos, Polygon zkEVM blockchains. It has recently included Linea Goerli testnet as well.
Because it’s on its own native blockchain, you can swap tokens and even perform yield farming for incredibly low fees. It’s designed to be user-friendly, making it super easy to buy, sell, and trade BSC tokens.
Now, when it comes to fees, PancakeSwap charges both buyers and sellers a 0.25% fee. That’s pretty standard for these kinds of decentralized exchanges. Over 1.5 million traders have used PancakeSwap’s DEX in just the previous month. And it’s not just for trading tokens, but they’ve got some cool yield services too.
Another thing to note is that PancakeSwap has minimal risk of slippage. They’ve got these liquidity pools that allow for automatic trading. This DEX also has its own native token called CAKE, which is most often used for staking, yield farming, and even governance.
Let’s dive into the world of Sushi, formerly known as SushiSwap. It’s actually one of the oldest decentralized exchanges in the DeFi space (first fork of Uniswap). You see, Sushi started off as a fork of Uniswap, but it quickly made a name for itself by offering better yields and lower fees. The Sushi team has gone above and beyond, creating their own unique product.
They’ve even launched this awesome cross-chain feature that lets you access other blockchain standards. With Sushi, you can hop onto Arbitrum, Polygon, Fantom, Binance Smart, and Optimism. Just a heads up though, Sushi doesn’t support Bitcoin. Just like Uniswap, Sushi charges a 0.3% fee for swaps. That’s the standard, you know.
And they’ve got this special token called SUSHI that lets you do some cool things. You can stake it and generate passive income. Plus, you get some governance benefits too. SushiSwap isn’t just about swapping tokens. Nope, they’ve got some awesome decentralized earning tools. One of them is yield farming pools. So, if you’re looking for a decentralized exchange that offers great yields, low fees, and a variety of earning opportunities, Sushi is definitely worth checking out. It’s like a buffet of possibilities for your crypto journey.
I want to buy and sell cryptocurrencies without KYC. Which exchange should I use?
You can use any decentralised exchange mentioned in this post. I mostly use Uniswap for all ERC20 based token swapping.
I want to leverage trade on a decentralised crypto exchange. Which one should I use?
For leverage crypto trading, I recommend DYDX. However, there are multiple options.
Which exchange should I prefer for buying BEP20 based coins?
I recommend Pancakeswap for all BEP20 trades (BSC chain).
Which exchange should I prefer for buying cryptocurrencies on Arbitrum chain?
You can use Uniswap or Sushiswap.
How to select the best decentralised exchange for yourself?
When you’re searching for a decentralized exchange to use, there are a few key factors to consider.
First, you’ll want to look for an exchange that’s user-friendly and easy to navigate. Next up, trading fees. You’ll want to find an exchange that offers minimal fees, as these can quickly eat into your profits. Another important aspect is trade volume and liquidity. You want to make sure the exchange you choose has enough activity and liquidity to ensure that your trades can be executed smoothly. Anonymity is also an attractive feature of decentralized exchanges.
With these platforms, you can trade without having to go through extensive identity verification processes. And of course, having a wide range of trading pairs is essential. It’s important to note that even the best decentralized exchanges have their downsides.
That’s why it’s crucial to do thorough research and familiarize yourself with different platforms before committing to one. Read reviews, compare features, and assess the overall reputation of the exchanges you’re considering. By doing your due diligence, you can find the exchange that aligns best with your needs and preferences.
Summary: List of Decentralised Crypto Exchanges
Here is the list of top crypto decentralised exchanges used in 2023.
|Main points – Summary
|With more than 64% marketshare, Uniswap
is mostly used decentralised crypto exchange.
Chains supported: Ethereum, Arbitrum,
Polygon, BNB Chain, Celo, and Optimism
|Mostly used for trading crypto on BSC chain.
Chains supported: BSC Chain, Ethereum,
Aptos, Polygon zkEVM, Linea Goerli testnet
|Curve specializes in optimizing stablecoin swaps
by reducing trading fees and slippage,
providing a range of liquidity pools for both
liquidity providers and traders.
|1inch is a decentralized exchange aggregator
that utilizes a smart contract to automatically
search and provide users with the best prices
sourced from multiple DEXes.
|OKX DEX offers X Routing to help users find
the optimal order placement route across various
DEXs, enabling price comparison, order splitting,
and minimizing slippage and gas fees in
multi-chain and cross-chain scenarios.
|Similar to Uniswap, a good alternative.
Decentralized exchanges play a crucial role in the crypto industry because they allow for cryptocurrency trading without the need for intermediaries or central authorities. They offer a compelling alternative to centralized platforms, offering benefits such as anonymity, low fees, and support for multiple blockchain networks. But that’s not all!
Decentralized exchanges also provide opportunities for earning interest on your crypto holdings. One of the great things about decentralized exchanges is that trades are executed instantly through smart contracts. This means you don’t have to wait around for approvals or worry about human error. It’s all automated and efficient.