Centralized vs. Decentralized Exchanges
A centralized exchange is a third party that matches up individuals and institutions looking to exchange with each other.
The role of a centralized exchange is to reduce the friction involved in exchange by providing liquidity
(“market liquidity refers to the extent to which a market, such as a country’s stock market or a city’s real estate market, allows
assets to be bought and sold at stable prices”- Investopedia-) and convenience through an account that holds funds and positions.