CEX/DEX development: key points

Exchanges are an effective tool for financial transactions with cryptocurrencies.

There are two types of exchanges — centralized (CEX) and decentralized ones.

What is a centralized exchange?

A centralized exchange is a platform owned and operated by a single entity that acts as an intermediary between buyers and sellers. This intermediary, or third party, facilitates transactions by providing liquidity for supported tokens.

CEXs offer key advantages:

1. Ease of use: user-friendly interfaces and simplified registration processes.

2. High liquidity: large user bases and high trading volumes for better liquidity.

3. Fast transaction speeds: quick and efficient transactions due to centralized servers.

4. Security measures: robust security with two-factor authentication and cold storage.

5. Customer support: prompt assistance for user inquiries and issues.

6. Regulatory compliance: compliance with regulations for legitimacy and security.

7. Advanced trading features: access to margin trading, futures contracts, and stop-loss orders.

What is a decentralized exchange?

A decentralized exchange (DEX) is a digital currency exchange that allows users to buy crypto through direct, peer-to-peer cryptocurrency transactions, all over an online platform without an intermediary.

DEXs offer key advantages:

1. Non-custodial trading: users control their funds directly.

2. Peer-to-peer trading: no intermediaries involved.

3. Decentralization and transparency: no single control point.

4. Enhanced security: funds are less vulnerable to hacks.

5. Lower fees: reduced trading costs compared to centralized exchanges.

6. Privacy and anonymity: less personal information required.

7. Integration of various tokens: supports a wide range of cryptocurrencies.

What are the differences between decentralized and centralized exchanges?

The main difference between DEXs and CEXs lies in their fundamental architecture and operational principles:

1. Control of Funds:

- CEX: Users need to deposit their funds into the exchange’s wallet, effectively giving up control of their private keys. The exchange holds and manages the users’ funds on their behalf.

- DEXs allow users to trade directly from their wallets without the need to deposit funds into the exchange. Users retain full control of their private keys and funds throughout the trading process.

2. Intermediaries:

- Centralized exchanges act as intermediaries in trades, matching buy and sell orders on behalf of users.

- DEXs operate on a peer-to-peer network, enabling users to trade directly with each other without any intermediaries.

3. Decentralization and Transparency:

- Centralized exchanges are controlled and managed by a single entity, making them more vulnerable to security breaches and manipulation.

- DEXs are built on decentralized blockchain networks, reducing the risk of hacks and providing greater transparency as trade data is recorded on the public ledger.

4. Privacy and Anonymity:

- Centralized exchanges often require users to complete Know Your Customer (KYC) procedures, collecting personal information for regulatory compliance.

- DEXs can offer more privacy, allowing users to trade without extensive KYC requirements.

5. Global Access:

- Centralized exchanges may restrict access to users from certain countries due to regulatory and compliance reasons.

- DEXs are generally accessible to anyone with an internet connection, making them available to a global audience.

6. Governance:

- Centralized exchanges are governed by the exchange’s team or a central authority.

- Some DEXs have community-driven governance models, allowing users to participate in decision-making processes.

Overall, DEXs provide greater user control, security, and privacy, while CEXs offer ease of use and liquidity due to centralized operations. Each type of exchange has its advantages and disadvantages.

What is the better choice?

Developing a DEX or CEX depends on your project’s goals, target audience, regulatory considerations, and technical capabilities.

A DEX might be the better choice if:

1. Decentralization is a priority.

2. Security and transparency are essential.

3. Anonymity is preferred.

4. Regulatory compliance is challenging.

A CEX might be the better choice if:

1. User experience is crucial.

2. Liquidity and trading volume are vital.

3. Faster development and scalability are needed.

4. Compliance with regulations is necessary.

Both types of exchanges have their own set of advantages and limitations. Regardless of your choice, it is crucial to collaborate with a reliable development team that can ensure the seamless operation of the exchange and implement robust security measures to safeguard user assets.

Why trust us?

With over 7 years of experience in the blockchain market, Crypton Studio excels in both custom and product development. Our portfolio includes the successful implementation of numerous web3 projects for clients from different countries and industries.

We have developed our own centralized exchange. We understand how to create an exchange with the necessary basic functionality, with effective security measures and control functions from the admin panel.

To find out more about our projects, contact us today.

RAO Exchange by Crypton Studio: Case study

RAO exchange is a platform where all the tools for convenient and safe cryptocurrency trading are combined. It is a secure and high-performance exchange with a wide range of functionality and customisation options.

Our team has developed a ready-made CEX solution with next features:

- Spot trading platform

- Cryptocurrency payment gateway

- Admin panel

- Market order type

- Limit order type

Advantages of RAO exchange:

- Performance of 300 orders per second

- Matching speed 600 trades per second

- Simultaneous servicing of at least 100 000 users

- Comprehensive customisation of networks, assets, integration with payment gateway

Tech stack of the project:

— Backend (Micro services): Go, NATS.io, Protobuf;

— Backend (Crypto Gateway): Node.js Javascript, PostgreSQL, Redis, Mongo.DB, Python

— Full Stack: Typescript, Javascript

— Frontend: Vue.js, Nuxt.js

How we develop crypto exchanges: step-by-step

1. Requirements gathering: Thoroughly documenting, designing, and establishing the project architecture and development roadmap while creating a comprehensive backlog.

2. Client harmonization: Ensuring seamless collaboration and alignment with the client’s vision and objectives.

3. Development: Implementing both frontend and backend components with expertise and precision.

4. Integration: Seamlessly integrating the different parts of the project for optimal performance.

5. QA testing: Conducting rigorous quality assurance testing to deliver a reliable and bug-free solution.

Roadmap: how to order project from Crypton Studio

• Contact our manager via the form on the website.
• We will schedule a call where we will gather your project requirements, study your needs.
• Then you will receive a borders and scope document, estimate of cost and timeframe.
• Once agreed, we will sign the contract.

Our company employs various development approaches, but two are of paramount importance:

• Full development cycle, where we take responsibility for all stages of the project.
• R&D-only, the initial stage of the complete development cycle, focusing on detailed requirement analysis.The primary result of this stage is the formation of the Software Requirements Specification, encompassing all necessary development requirements and aligning them with the client’s expectations.

What happens after the contract is signed?

• After developing detailed requirements, we provide a refined project estimation (Re-Estimation).
• We assemble a dedicated team for your project, consisting of a Project Manager, Business Analyst, Designer, QA Engineer, and Development Team.
• We apply the Scrum methodology, which allows us to complete the work on time and with high quality.
• Regular meetings and progress updates keep you informed about the development process.
• As we near project completion, we conduct comprehensive testing to ensure the functionality, performance, and security of the solution.
• Once all the testing is complete and you’re satisfied with the final product, we move forward with the project launch.

Our technical stack

• Frameworks: hapi.js, Vue 3, Vue(+Nuxt), Web3
• Programming languages: Golang, TypeScript, Solidity, JavaScript, NodeJS, Flutter
• DB: PostgreSQL, Redis web3, tronweb Vue 2, Nuxt.JS, JS

Our projects and solutions

• Our team developed a centralized cryptocurrency exchange in the customer ecosystem. The exchange provides access to trading popular tokens. Crypton Studio has developed a payment gateway, a trading terminal, a personal account, settings for secure access, confirmation of withdrawal of funds, and an API for algorithmic trading. As well as an admin panel with general functionality for managing and moderating the exchange. Flexible user verification at several levels and convenient interaction with the ecosystem’s P2P platform were implemented. A mobile application is currently being developed.

Programming languages — Golang, TypeScript

DBMS — PostgreSQL, Redis

User Interface — Web

Frameworks — Hapi.js, Vue 3

• Our team developed a decentralized margin exchange. The logic of that was provided by the customer. It has its own token rate within the ecosystem. This decentralized margin exchange allows users to trade cryptocurrency with a margin or leverage feature. It is not backed by any single entity, but rather is a peer-to-peer network where each participant’s activities are integrated, and the risk is spread out among the participants.

Programming languages — NodeJS, JavaScript

User Interface — Web

DBMS — PostgreSQL

Frameworks — Hapi.js, Web3, Vue(+Nuxt)

Want to know more about our projects of developing CEX/DEX? Write to us.

FAQ

How long does it take to create a CEX\DEX?

The time frame depends very much on the functionality and additional options implemented and the complexity of the project. It can therefore vary from a few months to half a year. We usually take an individual approach to estimating time for each project.

How much does it cost?

The cost of developing a DEX or CEX can vary significantly depending on several factors such as the features and functionalities you want to implement, the complexity of the project, the technology stack, and the development team’s hourly rates.

What are the key differences between decentralized and centralized exchanges?

Decentralized exchanges (DEXs) operate on a peer-to-peer network, allowing users to trade cryptocurrencies directly with each other without intermediaries. They provide higher security and privacy.

Centralized exchanges (CEXs) are operated by a centralized entity that acts as an intermediary between buyers and sellers. They offer convenience and access to a wider range of cryptocurrencies.

What features does the exchange provide?

Exchanges, whether centralized or decentralized, offer various features to facilitate cryptocurrency trading and investment. Some common features include:

• Trading Pairs: Exchanges allow users to trade different cryptocurrencies against each other (e.g., BTC/ETH, BTC/USDT).
• Order Types: Traders can place different types of orders, such as market orders, limit orders, stop-loss orders, and more.
• Wallet Integration: Users can deposit, store, and withdraw their cryptocurrencies from the exchange’s integrated wallets.
• Trading Charts: Advanced charting tools and technical analysis indicators help traders analyze price trends and make informed decisions.
• Order Book: The order book displays buy and sell orders placed by users, providing transparency and market depth.
• Security Measures: Robust security protocols, two-factor authentication (2FA), and encryption are implemented to protect user funds.
• Liquidity: The exchange’s liquidity affects the ease of trading and price stability.
• Trading Fees: Exchanges charge fees for trading activities, which can vary based on the platform.
• KYC/AML Verification: Some exchanges require users to complete Know Your Customer (KYC) and Anti-Money Laundering (AML) verification processes for regulatory compliance.
• Margin Trading: Certain exchanges offer margin trading, allowing users to leverage their positions for potentially higher returns (but also higher risks).

How do I ensure that CEX/DEX is secure and stable?

To ensure a secure and stable CEX or DEX trust an experienced development team. In Crypton Studio we provide such security measures like:

— A thorough security audit

— Two-factor authentication (2FA)

— Cold storage for funds

— Securely management of private keys

— Regular software and frameworks updated

— Strong encryption for data and communications

— Deployment of DDoS protection

— Implementation of real-time monitoring and alert systems

How can I order a project from Crypton Studio?

To begin our collaborative journey, simply reach out to us through the convenient form on our website. We will arrange a meeting where our Sales Manager will gather key requirements for your project, taking into account all your needs.The outcomes of these discussions will be:

A document outlining the scope and boundaries of the project (Border and Scope) to clearly define its parameters.A preliminary estimation of costs and timelines (Preliminary Estimation) to understand the anticipated expenses and timeframes. Once we reach an agreement, we will proceed to sign the contract. Our company employs various development approaches, but two are of paramount importance:

— Full development cycle, where we take responsibility for all stages of the project.

— R&D-only, the initial stage of the complete development cycle, focusing on detailed requirement analysis.

Can I hire individual developers in my team to work under my supervision?

Yes, we can provide you with a separate smart contract developer, or a team of specialists for the duration of your project. Find out more about our outstaffing services. We also recommend downloading our free app to find developers for blockchain projects. You can find suitable specialists in our database already today.

Install it from Google Play or App Store.