A centralized exchange generally refers to a managed asset trading place controlled and managed by a company or operating entity. . Users need to deposit their assets on the platform to start trading. In traditional finance, stock exchanges such as NYSE, Nasdaq, etc. are all centralized exchanges. Binance or Kraken are centralized exchanges in the crypto industry. They operate in a manner similar to Nasdaq, using a central order book model to match transactions and determine asset prices.

The picture above is Binance, which is also the world's largest centralized encryption exchange. BTC/ Screenshot of the order book for the BUSD trading pair. The green numbers in the lower half are buy orders from potential buyers, while the red numbers in the upper half are sell prices from potential sellers. When a buy order and a sell order price match, the transaction is successfully matched and that price is treated as the latest BTC spot price.

Although centralized exchanges tend to have greater liquidity, users cannot truly control their assets, which means that users have to bear many risks of the exchange's own qualifications, such as Mt. Gox in 2014 Hackers and the bankruptcy of FTX in 2022 have all caused great losses to users.

• Typical centralized cryptocurrency exchanges: Binance, Coinbase, OKX, Kraken, Bybit, KuCoin, etc.
• Typical traditional centralized stock exchanges: New York Stock Exchange, Nasdaq, etc.

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