Digital Asset Exchanges are central services through which allows you to trade or invest in Crypto systems. These exchanges provide a safe, secure and manageable system through which you can buy crypto tokens from other people.
There are a large number of Crypto exchanges – with Binance and CoinBase being some of the most popular. These exchanges consistently increase revenues due primarily to the massive influx of retail traders buying up the various Crypto tokens. Since each Crypto exchange has its own benefits, the most common traits are that they will typically only provision the trade of “Bitcoin” for “fiat” currency. Most systems will not touch “alt” coins because they have such low values, and such volatile prices.
To this end, two types of exchange have grown – fiat/crypto and crypto/crypto.
Binance provides the ability to trade Crypto in pairs, without having to use fiat in the transaction. Therefore, if you want to buy Litecoin or Etherium, you typically have to buy Bitcoin through an exchnage such as CoinBase, and then transfer the BTC into Litecoin or Etherium via Binance.
Unlike traditional currency exchange services, Crypto exchanges do not handle the currencies directly. While it’s true that they will store the tokens on their exchange, it’s almost always the case that they will actually just act as a “wallet” for you – meaning that when they find a buyer, they trigger the sending process without you having to do anything.