The rapid growth of hybrid cryptocurrency exchanges is definitely changing the crypto landscape.
The rise of cryptocurrency also gave birth to several crypto exchanges to facilitate the selling and buying of cryptos. Since then, the market has witnessed several types of exchanges like centralized cryptocurrency exchanges (CEX), decentralized cryptocurrency exchanges (DEX), and hybrid cryptocurrency exchanges. As cryptocurrencies are digital assets, investors faced multiple issues in their exchange on the existing networks. It is one of the primary reasons for the existence of different exchanges.
Hybrid cryptocurrency exchanges were created based on the limitations of both centralized and decentralized exchange platforms. This crypto exchange platform combines the positive features of centralized and decentralized platforms. It consists of the usability and liquidity of centralized platforms and the anonymity and security of the decentralized exchanges. Users tend to have total control of their funds and can trade digital assets directly from their wallets while depositing tokens into the robust smart contract, without any third-party interference.
The rise of hybrid cryptocurrency exchange platforms resulted because of the shortcomings of the other two exchanges. CEX platforms not only charge high transaction fees but also exercise total autonomy over the investors’ funds. CEXs store the investors’ assets on hot wallets, which are very easy to hack. On the other side, DEX platforms are known for processing transactions very slow, which proves unsuitable for the users who are planning to leverage the cryptocurrencies’ volatile prices.
The Benefits of the Hybrid Exchange
It gives users real-time service access and provides solutions to different problems based on blockchain technology. It not only addresses the shortcomings of both the exchanges but also allows traders to perform transactions on them. These platforms allow the users to have complete autonomy of their funds and do not allow third-parties to regulate exchanges in cryptos.
Apart from these, these platforms ensure privacy to their users, the policies of which comply with the different laws guiding digital currencies. Unlike centralized exchanges, the users’ funds are not stored in hot wallets. The funds are stored in a digital wallet that is not connected to the internet, which is also known as cold storage. These platforms aim to provide the highest security to their users by preventing cyber-attacks. A hybrid cryptocurrency exchange is interesting and convenient for traders around the world for its transparency and swiftness in transactions.
The Impact
These platforms are generally scalable which puts them in a position as the potential crypto exchange hub in the future. With the growing awareness of cryptocurrency, many have started to consider it as a lucrative investment option. With the introduction of hybrid exchanges, the crypto landscape is moving towards a more responsible and informative platform to carry out transactions safely. Hybrid exchanges have turned out to be the missing link between centralized and decentralized platforms.
