10/8/2022

Clearing confusion around Cryptocurrency Centralized Exchange

By: Tasnim Mahi

What are centralized exchanges? Centralized exchanges are platforms that are used to buying and selling cryptocurrency, using fiat currencies or digital assets. They function as intermediaries in trades and a safe that protects your funds. Who are the industry leaders of this sector? Binance Coin (BNB), Crypto.com Coin (CRO), FTX Token (FTT) How do Centralized exchanges make money? Binance makes money from trading fees, interest on loans, spreads, fees, cloud offerings, interchange fees, mining services, and profits from investments. Trading using this platform is not free and users are charged with many fees for different trading offers. Furthermore, to partake in Binance’s mining pool, users will have to pay a 2.5 percent pool fee on Bitcoin and a 0.5 percent fee on Ether in order to be in Binance’s mining pool. Notable Trends - Crypto exchanges have increased their market share from 89% in 2021 to 96% in 2022 - Top exchanges traded a total of $1.5 trillion in February 2022 compared with $62 billion in the low exchanges Future Challenges The cryptocurrency exchange industry is currently facing political pressure to put on exchanges to enforce Russian sanctions as an area that could see more action. This can pose as a threat to the future of the Centralized Exchange.