CeFi and DeFi - Differences
CeFi refers to traditional finance where users trade crypto over a platform on which they basically trust the agency and other users.
- Transaction processing efficiency
- More trading pairs
- High transaction fees
- Lack of privacy
- Lack of transparency
- Lack of absolute control over funds
DeFi is a new development in the crypto world that manifests in the form of fully decentralized blockchain applications that take third party institutions out of the picture. The users trust the exchange protocol instead of the agency.
- Fully automated
- Universally accessible
- Greater degree of system interoperability
- Relatively lower liquidity
- Project scalability
- Lower tolerance for human operational error