If you are following the cryptocurrency hype, there is no way you haven’t heard of decentralized exchanges before. Most crypto enthusiasts see them as a secure and robust digital marketplace.
But what makes them so special? What are the top 5 decentralized exchanges of 2021?
Hop on, we are going on a ride!
What are Decentralized Exchanges or DEX?
Decentralized exchanges are financial marketplaces that operate on a peer-to-peer basis. Unlike a traditional marketplace, which stores the transactional data at a centralized server, DEX operates through an escrow system with multiple signatures or tokens.
The tokens, in this case, are digital assets such as fiat currencies or cryptocurrencies.
Due to the automated peer-to-peer network of transactions, the decentralized exchanges are much more secure and private than traditional marketplaces.
They are also cheaper and more efficient. If appropriately implemented, the decentralized exchanges show high scalability too.
All these benefits are there to be had. But which Decentralized Exchanges in 2021 are the best? Let’s look into that now.
Top 5 Decentralized Exchanges of 2021
Based on the feature set, ease of use, and popularity, here are the top 5 decentralized exchanges of 2021 in no particular order.
The team behind Uniswap is based in Bew York, and Uniswap is the largest DEX in terms of market share by volume.
Uniswap uses ERC-20 tokens and provides a robust and efficient trading platform without the need for interference from a third party.
It is a liquidity pool and decentralized exchange. It recently launched Uniswap V2 with some security and usability improvements to further enhance the user experience.
Earlier, there was an intermediate ETH step involved while swapping two tokens. The need for that step is long gone, and transactions have also become cheaper.
Uniswap V2 uses almost the same design for the platform as the initial V1 to keep uniformity. If it ain’t broke, why fix it!
Overall, the ease of use, security improvements, and renowned name put Uniswap into the top 5 Decentralized Exchanges of 2021.
Anyone with the slightest knowledge in cryptocurrency trading has heard of Binance for sure. Apparently, the people behind Binance do not wish to give up on any opportunity to give up market share. Because after gaining much popularity in 2019, they launched their Decentralized Exchange called BinanceDex.
There are 25 trading pairs available to be used in BinanceDex, and the number should only go up. Yes, it is nowhere near the 1200+ of Binance CEX, but there are many advantages for BinanceDex that we have to mention.
The BinanceDex platform is open-source and hence community-driven. It has its wallet system, which gives complete control to the users. The rest of the security advantages that any DEX has over CEX apply here as well, more or less.
The sheer popularity of Binance and BinanceDex having the same background makes it one of the popular options for the top 5 decentralized exchanges of 2021.
Bisq is a bit different from other Decentralized Exchanges. It allows its users to trade Bitcoin for real-world fiat currencies via its desktop application. The application itself is open source.
It is one of the handful DEXs that support fiat conversion globally without any requirement of KYC. The unique protocol of its networks makes this possible.
The platform is privacy-centric and uses a combination of technologies to keep the identity of its users safe. It even uses the Tor routing system to keep user IPs safe from the snoopers!
Due to the platform’s anonymity and other privacy features, the Bisq network is one of the top choices for investors.
Synthetix uses the Synthetic Network Token (SNX) to collaborate synthetic assets. It is a synthetic-asset decentralized exchange providing a flexibility that is rare among its competitors.
Users need to lock up SNX in-network smart contracts to create Synths. Users can then trade these new assets globally exactly as any other decentralized token.
What’s the best part, you ask? The system lets users perform the conversion between the synchs with the smart contract directly! Without any third-party intermediaries!
Recently, the SYNThetix platform underwent a major upgrade, which was called the Hadar upgrade. It enabled allows users to tokenize real-world assets such as stock indexes and oil commodities.
0x protocol started its service in the year 2016. The 0x network functions as a peer-to-peer exchange for digital assets on the open-source Ethereum network.
The protocol itself is open-source, and the name 0x is a reference to the first letter of Ethereum wallets.
We are seeing a trend of growing adoption in the 0x network. Being one of the largest producers of DeFi and DEX networks, the developers of Ethereum continue to build on its ecosystem. Each new that uses the Ethereum platform adds value to the underlying tech for sure.
The 0x platform functions as a liquidity aggregator across different decentralized exchange (DEX) networks. Thus, 0x API allows developers to discover the best price on each of the trading pairs.
The network’s system uses some bridge contracts for tapping into the liquidity pools of both on-chain DEX networks.
All these features make the 0x network one of the contenders for the top 5 decentralized exchanges of 2021.
This concludes our list of the top 5 Decentralized Exchanges of 2021. Sure, we might have missed some platforms that you feel should be in the top 5. You might also feel that some of the platforms listed here shouldn’t be included.
But the competitiveness among these platforms and their developers looking to improve them all the time makes them even better. It’s a win-win for everybody!
I hope this article helps you and if you have any queries related to it then do leave your comment below. If you have not joined our community then you can now. We are very active there and have been sharing important information there.
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