Exchange can be a physical location where traders meet to do business or an electronic platform. They may also be referred to as stock exchanges or “exchanges”, depending on the geographic location. These exchanges are located in most countries around the world.
In the last decade, trading has shifted to electronic exchanges almost completely. Sophisticated algorithmic price matching can ensure fair trading without requiring all members to be physically present on a centralized trading floor.
An exchange is an organized market where financial instruments – such as crypto, commodities, and securities – are traded. Exchanges can operate on real-world facilities or on digital platforms. Many traditional platforms, initially limited to physical trading, are now providing digital services as a way to enable electronic commerce (also known as paperless trading). One of its main functions is to provide liquidity in a safe and organized trading environment, acting as an intermediary for traders to easily buy and sell their assets while being less exposed to financial risks.
Exchanges can be classified according to the type of trade executed. The first is classic. Classic here means an exchange platform that performs spot trades (immediate or instant settlement). On the other hand, there are exchanges that provide derivatives trading, such as futures. Exchanges can also be classified according to the financial instruments traded: crypto asset exchanges, stock or securities exchanges, commodity exchanges, and foreign exchange (Forex) markets. However, many exchanges provide a variety of trading services and options. For example, many commodity exchanges also offer futures trading.
In addition, now there is also a Decentralized Exchange or DEX. Actually, the system between DEX and you crypto asset transactions is usually the same. The only difference is that in DEX trading you don’t need to register and KYC first. DEX trading utilizes a blockchain network where transactions occur between two digital wallet owners i.e. seller and buyer directly, as the name implies, decentralized or not centralized.
Indodax as one of the Exchanges in Indonesia
In choosing a trading platform for crypto assets, Indodax has many advantages that you can consider. In addition to the examples in the previous article, Indodax also has hundreds of choices of crypto assets that you can buy and sell. All of these crypto assets have gone through a due diligence process, which means they have passed the following main requirements:
- Project link in CMC
- Maximum Supply
- Amount of circulating supply