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Exchange

Definition

A marketplace or service where people buy, sell, trade, or custody crypto assets.

In Plain English

A crypto exchange is like a brokerage account combined with a currency exchange.

Real-World Example

A company may use an exchange to convert dollars into stablecoins for a blockchain payment workflow.

Why It Matters for Your Work

Exchanges affect custody, fees, liquidity, compliance, and counterparty risk.

Common Mistake

Assuming assets held on an exchange are controlled the same way as assets in a self-custody wallet.

Related Terms

KYC

Know Your Customer: identity checks used to verify users, especially in finance and crypto.

Wallet

A tool that lets someone hold and use crypto assets by controlling private keys.

Liquidity

How easily an asset can be bought or sold without significantly moving its price.