Decentralized trading platforms remain a daunting space for many newcomers, despite the wild rise of cryptocurrencies over the past few years. There is a lot of jargon and nuance that users might not understand. But today, we will boil it down to its essentials.
This guide is aimed at helping beginners navigate the process of trading digital assets on a Decentralized exchange (DEX) and will provide a step-by-step overview of the process.
Understanding Crypto Wallets
A crucial component of trading digital assets is a secure and reliable crypto wallet. Digital wallets generate a seed phrase that allows you access to your funds. This seed phrase operates as a password and login, so be very careful with it.
There are different varieties of crypto wallets which cater to different needs; this includes hardware wallets requiring an external device, software wallets that must be installed on your computer, and browser wallets that are accessed through a browser extension. Each option has its own set of benefits and drawbacks, making it essential to choose the one that best aligns with your security and convenience needs.
Regardless of which you pick, be careful about revealing any information to third parties – there is no logical reason why you should reveal your seed phrase to any website or person.
Connecting the Crypto Wallet to the DeFi Trading Platform
Once you have chosen a crypto wallet, you need to connect it to a DeFi trading platform. Most DEXs require you to deposit your digital assets into their platform before trading, which means that you temporarily lose control of your assets while you trade.
However, there are emerging alternatives. For example, Axo is a unique decentralized exchange platform that allows you to set up trades while keeping your assets in your control until the moment of trade execution. This provides you with greater control over your assets and eliminates the need to trust a third party with your funds, as only transactions that you consent to can happen.
Making Trades on the DeFi Exchange
Once you have connected your crypto wallet to the DeFi exchange, you’re ready to start trading. Like a centralized exchange, you can buy, sell, and exchange digital assets using the DEX’s interface. The added benefit of trading on a DEX is its more secure and transparent trading experience.
In conclusion, trading digital assets on a decentralized exchange platform is one of the first ports of call that people in DeFi will make. As daunting and difficult as it might initially seem, the process is rather straightforward: you just need to understand crypto wallets, store your assets securely, connect your crypto wallet to the DeFi exchange, to start trading with confidence.
If you want to simplify your life, whether you’re a beginner or an experienced trader, Axo is a reliable and user-friendly DeFi exchange platform you can trust.
