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KuCoin: Decentralized Or Centralized Or DeFi?

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When it comes to crypto exchanges, many people just know Binance. Although Binance is the largest crypto exchange, it’s not the only one.

In this piece, let’s consider another popular crypto exchange: KuCoin.

Is KuCoin Decentralized?

KuCoin, in its current state, isn’t decentralized. 

KuCoin (KCS) is a centralized crypto exchange with plans to shift into a fully decentralized exchange. It’s an excellent platform for users to buy, sell and store their crypto assets. 

KuCoin aims to provide a globally cheaper trading platform for cryptocurrency users.

How KuCoin works

KuCoin has strong backing from its community and the platform’s Total Value Locked (TVL). As of this writing, KuCoin is among the leading crypto exchanges with over a trillion dollars in total traded volume and over 20 million active users. 

KuCoin community members participate in the network by earning daily bonuses from their most traded token, which equals 50% of the users’ trading fees on the exchanges. Also, KCS holders have a bonus on any referrals they attract to the network. 

Learn more: Is Kucoin Decentralized?

Is KuCoin A DeFi?

KuCoin isn’t a fully decentralized finance platform. However, KuCoin will also be a formidable DEX platform by rolling out its decentralized exchange platform. 

KuCoin supports over 700 altcoins and boasts a cumulative $1 trillion trade volume.

What Makes An Exchange Decentralized?

Decentralized exchanges operate on a peer-to-peer basis to allow users to trade with each other without any middlemen. Transactions on DEXs are possible because of smart contracts. 

Below are factors that differentiate centralized exchanges and decentralized exchanges:

Automated Market Maker (AMM)

DEXs run on a system that self-executes to handle liquidity shortfalls on the platform. AMMs rely on smart contracts, which communicate with other blockchain networks to determine the prices of digital assets in the markets. 

Anonymity

Unlike CEXs, decentralized exchanges follow the original guidelines of blockchain technology by hiding their users’ identities. If you wish to make private trades, use a decentralized exchange. 

Most decentralized exchanges don’t require any signup information from their clients. You can access their portal, trade with other users, and exit if you have a wallet address. 

No Intermediaries

DEXs have no central authority to determine the operation within the platform. When you trade on a decentralized exchange, you sell or buy your crypto assets directly from other users. However, you’ll need a crypto wallet and tokens to pay your gas fees.

The lack of intermediaries helps reduce the cost of trading while maintaining your privacy. 

Token Availability

Decentralized exchanges provide a platform for users to trade almost any kind of cryptocurrency. So, you will easily find most tokens on a DEX because there are no stringent measures from local authorities or the CEX.

When To Use KuCoin?

KuCoin is an excellent choice for beginners and advanced traders. Like any other centralized exchange, you can use KuCoin to:

  • Trade tokens across blockchains within the same exchange platform. 
  • Have a safe place to store your crypto assets.
  • Find a crypto exchange with good liquidity.
  • Earn passive income through liquidity provision and referrals.
  • Use an exchange with ultra-low fees in the market.
  • Trade crypto in over 200 countries. 

Is KuCoin Better Than Binance?

KuCoin and Binance are among the biggest crypto exchanges in the crypto markets today. Both exchanges have great features that serve beginners and expert traders. 

But none is better, it just depends on your needs. if you want a CEX that supports anonymity and has access to more altcoins and high trading volumes, choose KuCoin

If you want to trade on an exchange that offers unlimited trading amounts, accepts fiat currency, and provides an excellent user interface for its users, pick Binance

We also recommend reading our guide comparing Binance and Uniswap. You’ll learn about their differences and similarities.

What Is Better Than KuCoin?

No singular crypto exchange competes as closely with KuCoin as Binance. However, there are plenty of other exchanges that serve other needs. Examples of such exchanges include PancakeSwap, Uniswap, Coinbase, and Kraken. 

What Is The Best Centralized Exchange?

Binance is the best centralized exchange today. It offers features and products that work best for new and expert users. Here’s why you should pick Binance:

Low Fees

Binance lets its users trade on the exchange with the lowest fees. Today, Binance users have only 0.1% on spot transactions and crypto exchanges.

Supports Many Cryptos

Binance allows trading over 600 tokens and nearly 100 cryptocurrencies for Binance.US. You can trade as many tokens as you wish. 

Security

Once you open an account with Binance, you can initiate two-factor authentication. Binance and Binance.US run on a centralized structure that is under the watch of the Federal Deposit Insurance Corporation (FDIC). 

What Is The Best Decentralized Exchange?

There’s no singular decentralized exchange that’s better than the rest. All DEXs have unique features and meet the demands of specific customers.

For example, some DEXs only handle tokens from a particular blockchain, while others are open to multi-blockchain exchanges. 

  • If you want a DEX with the highest Total Volume Locked (TVL), then Uniswap is your go-to exchange.
  • If you want to trade Ethereum tokens (ERC-20) only, Uniswap is a great partner.
  • An excellent exchange for your BEP-20 tokens is PancakeSwap.

Interested in learning more? Read our guide about getting started with Uniswap: Does Uniswap Have An APP (Guide)

How To Invest In DeFi?

Here is how you invest in DeFi:

Get a Wallet

A crypto wallet is how other players in the market identify you. It’s also where you store your crypto assets. A wallet lets you trade on DEXs and CEXs by sending, receiving, and swapping your crypto.

Buy Tokens

If you’re an intermediate or expert trader, you know funds are required to buy stocks or shares. In DeFi trading, you need crypto coins to participate. There are several places you can buy your first token; for instance, if you’re trading ERC-20 tokens, ETH is an excellent token. 

Find a DeFi protocol.

You need a platform that lets you participate in DeFi activities such as providing liquidity, lending, trading cryptocurrency, or staking your coins. Most DeFi protocols have websites or downloadable applications you can use. 

Manage your portfolio

After setting up the above successfully, you need to track your DeFi investment, or you will lose it. You can follow up manually or choose among the many portfolio trackers offered in the crypto market.  

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