What it means
A list of buy and sell offers at different prices, matched against each other, as on a stock exchange.
Centralised exchanges use order books. Most DEXes use pools and a pricing formula instead.
How it works
Both aim to give you a fair price; they just find it differently.
Related terms
| Term | What it means |
|---|---|
| CEX | Centralised exchange: a company that runs a trading platform and holds your money while you use it, such as Coinbase or Binance. |
| AMM | Automated market maker: a DEX that prices trades with a formula over a pool of tokens, instead of matching buyers and sellers. |
| DEX | Decentralised exchange: smart contracts that let you trade tokens straight from your own wallet, with no company holding your money. |
This glossary explains terms in general. It isn't investment, tax or legal advice.