Decentralized Exchange (DEX)
An on-chain venue where smart contracts let users swap tokens directly from their wallets, with no custodian.
A DEX replaces the company with code. Uniswap, the largest, runs on Ethereum and settles every trade through smart contracts. You connect a wallet, approve a swap, and the protocol prices it against a liquidity pool. No sign-up, no deposit, and you keep custody the whole time.
The trade-offs are real: gas fees and slippage on big orders, with no recourse if you send funds to a bad contract. A mistake on a DEX is yours alone.
Related terms
A company that runs an order book, holds your funds, and matches buyers with sellers for a fee.
Automated Market Maker (AMM)A pricing algorithm that lets a token pool quote and settle trades automatically, replacing the traditional order book of buyers and sellers.
Liquidity PoolA pot of tokens locked in a smart contract that traders swap against, with prices set by a formula.
DEX AggregatorA tool that splits an order across multiple decentralized exchanges to find the best swap price.