Exchanges and Order Basics
Exchange types, market vs limit orders, fees, and custody basics.
What an exchange is
A crypto exchange is a marketplace connecting buyers and sellers. Centralized exchanges (CEXs) match orders and hold custody as a company, while decentralized exchanges (DEXs) do this through smart contracts. The two models differ in fees, speed, and custody responsibility.
Market vs limit orders
A market order executes immediately at the best available price — fast, but the fill price can differ from what you saw. A limit order executes only at your chosen price — you control the price, but the order may never fill. Traders distinguish between the two depending on context.
Fee structure
Exchange fees are usually a percentage of trade size, often with different rates for makers (adding liquidity) and takers (removing it). It is commonly noted that frequent trading can compound fee costs quickly.
Custody
Keeping assets on an exchange is convenient but exposes you to exchange risk; moving them to a personal wallet shifts responsibility for key management to you. The saying "not your keys, not your coins" summarizes this trade-off.
Note
This lesson is educational material explaining concepts — it does not recommend any exchange or trading approach.
This educational content explains concepts for informational purposes — it is not investment advice or a recommendation to take any action.