Best Decentralized Exchanges – Meet the Leading Brands

With top decentralized exchanges (DEX) like Uniswap hitting a trading volume of  $50 billion in January 2021, it’s certain that there is so much to expect from DEXes in 2022. Judging by the current buzz in DeFi adoption—standing at 5.3% market dominance—use cases for DEXes could increase by over 15% by the end of Q1 of 2022. 

Currently, there are over 100 decentralized exchanges in the industry, with more to come. However, this article comprises a list of hot picks based on a well-researched methodology to ease the stress of browsing through long lists of dexes to find the perfect one to trade cryptocurrencies. 

For the sake of newbies in the decentralized exchange market, let’s go back and refresh our memories on what DEXes are.

What is a Decentralized Exchange (DEX)?

Centralized exchanges have been the benchmark of crypto trading since the introduction of Bitcoin in 2009. They provide users with the platform to trade cryptocurrencies in an all-in-one model.

An all-in-one model implies that users trade and hold funds in a single platform. Users complete KYC and limit their anonymity levels, borrow funds during margin trades, and follow strict rules and regulations that could pose serious threats when misunderstandings arise on their preferred platforms. All these and many more exposed the merits and demerits of centralized exchanges. 

However, since the revolution in the crypto community calling for the decentralization of many sectors monopolized by centralized institutions, decentralized exchanges have been a hot pick for many crypto enthusiasts because they offer better benefits and allow the distribution of decision-making power among users. 

Decentralized crypto exchanges offer crypto trading without a brokerage or third-party escrow. Most of them use an automated market maker (AMM) model, allowing users to trade directly in the market instead of fulfilling orders using order books as in centralized exchanges.

A major advantage of DEXes is that they grant users from any jurisdiction—including the US, where crypto trading faces strict scrutiny—access to the crypto market. This achievement is because users do not need to sign up to use DEX or related products and services. 

Another interesting thing about decentralized crypto exchanges is the additional incentives and campaigns they bring along, including staking, farming, and the regular listings of non-popular but profitable tokens.

With that said, here are our top picks for dexes!

Uniswap — Overall Best Decentralized Exchange

Why We Chose It

Uniswap is one of the oldest and largest decentralized crypto exchanges in the industry. It is also open-source and uses the AMM protocol to execute crypto trades on its platform.

Overview

Uniswap, also known as Uniswap protocol, is currently one of the industry’s oldest decentralized exchanges. It runs on the Ethereum blockchain and accepts ETH-modeled tokens on its platform.

Since Hayden Adam launched the exchange in 2018, it has garnered mass recognition and partnership, getting fundings from top names in venture capital industries like Andreessen Horowitz, Union Square Ventures, etc.

Uniswap boasts an accumulated trading volume of over $380 Billion with over 1.5 Million active users and over 66 Million trades since inception. It’s fully community-driven and open source.

It has a liquidity pool where users can add or remove liquidity using LP tokens. Additionally, UNI token holders may participate in the community-driven voting pool to decide innovations on the Uniswap protocols.

Uniswap charges about 0.30% fees for crypto swapping. However, it shares these fees among liquidity providers on the platform. Additionally, there are no fees charged for listing a token on Uniswap. 

Users can fork Uniswap’s code for creating and customizing their crypto trading platforms as an open-source community-driven exchange. Uniswap uses its bug bounty incentive to help keep its platform secure.

SushiSwap—Best DEX for Staking and Yield Farming

Why We Chose It

SushiSwap is a top decentralized exchange that is community-driven and fun. It has a well-designed user interface and offers a good utility token to investors.

Overview

SushiSwap’s creator may have loved Sushi so much that it named the exchange and its utility token after the food. Launched in August 2020, SushiSwap has grown considerably to become a billion-dollar exchange, with an average daily trading volume of over $3 billion.

Its governance token, SUSHI, gives holders the additional privilege of participating in the platform’s DAO governance activities, including voting and staking.

SushiSwap is community-driven and open-source and offers additional services, including yield farming, crypto swapping (trading), lending, and borrowing. Uniswap’s governance token is worth over $12 in the market at the time of this writing.

SushiSwap operates quite a competitive fee structure which attracts users from the crypto community. It charges about 0.3% fees, in which it shares 0.25% to liquidity providers and 0.05% to Sushi token holders.

SushiSwap has tons of crypto projects and is one of the few DEXes that offers additional decentralized finance support to upcoming and infant projects or dApps in the industry. The exchange also regularly introduces new features and products as voted by the community that drives it to progress.

PancakeSwap Exchange—DEX With the Most Supported Cryptocurrencies

Why We Chose It

PancakeSwap is one of the most trusted decentralized exchanges in the industry, offering an AMM crypto trading model, staking, yield farming, and additional incentives on its platform.

PancakeSwap is a billion-dollar exchange. Its Version-2 allows users to convert ERC20 tokens to BEP20 tokens, giving equal access to all crypto traders.

Overview

PancakeSwap Exchange started operations in 2020 by a group of anonymous developers. In 2021, the exchange grossed over $1 billion, launching the V2, which provides additional offerings and services than the V1.

The exchange runs on the Binance Smart Chain (BSC), supporting many BEP20 tokens, and offering crypto trading using the AMM model for matching orders. It rewards users who add or remove liquidity on its platform with its governance token, CAKE tokens.

The CAKE tokens are the exchange’s utility tokens. It comes with additional benefits such as low trading fees, farming (LP tokens), staking (Syrup pools), and more.

PancakeSwap also gives users the platform to win CAKE tokens by playing its lottery program and price prediction campaign. The price prediction campaign allows users to vote the market price direction while the lottery program assigns numbers to users, rewarding lucky numbers with CAKE tokens.

Many crypto enthusiasts love PancakeSwap because of the competitive fees it offers traders. Liquidity providers who participate in staking and farming earn additional benefits from the fees of normal traders.

PancakeSwap roadmap/to-do list shows many prospects and innovations the exchange looks to incorporate in the future, which could earn it some additional reputation in the long run.

Curve Finance—DEX With Lowest Fees

Why We Chose It

Curve Finance offers in-depth AMM models to crypto markets in the decentralized exchange ecosystem. It offers unique crypto markets that are not readily available in the market.

Overview

Curve Finance is a decentralized exchange that provides deep on-chain crypto trading protocols on its platform. The platform is designed on the Ethereum network but offers a bridge for Avalanche, Arbitrum, Polygon, Fantom, Harmony, and xDAI.

Curve Finance offers instant crypto trading, farm pools that enable users to add liquidity to its exchange. It offers one of the lowest fee structures in the industry, beginning at 0.04%. However, the exchange distributes 50% of the fees to CRV holders and farmers on the platform.

Curve Finance user interface is not so intuitive and user-friendly, and beginners may find it hard to comprehend its features at a glance. The exchange has a stats section that shows how cryptocurrencies perform in the crypto market.

Although Curve Finance’s platform is adequately audited and follows strong security measures, it implores liquidity providers of potential security risks of using its platform.

Curve Finance is a great platform, providing extensive market analysis to crypto assets traded on its platform. However, Blockpug recommends it for advanced traders who understand basic things about using such an exchange.

dYdX 

Why We Chose It

dYdX is one of the first and foremost decentralized exchanges to offer margin and derivatives trading. It also operates one of the lowest fee structures in the industry.

Overview

dYdX is an open-source and community-driven decentralized exchange that offers derivatives and margin trading. Its offering sets it apart and unique from most decentralized exchanges in the industry.

Antonio Juliano founded the exchange in 2017 to offer decentralized margin trading, just like in the centralized exchange industry. It remains one of the leading decentralized exchanges offering the same services and features as centralized exchanges to date.

dYdX offers spots, margin, derivatives, and perpetual trading. It allows users access to intuitively designed crypto price charts and technical analysis tools.

User experience and the interface are generally great on the platform, too, allowing users to take positions like they do in CEXes.

Despite its quality offerings, the exchange offers one of the lowest fees, which begins at 0.00%-0.05% for makers and 0.06%-0.10% for takers. However, depending on your trading volume or VIP position, discounts apply accordingly.

To use dYdX, you must connect your wallet. This protocol also implies that users are responsible for their security on the platform and must adopt strict security measures while they trade on the exchange.

dYdX offers support to DeFi developers to adopt its API and smart contracts to create exclusive trading platforms that suit their preferences. Users can also stake on the platform, participate in its voting protocols using dYdX tokens, and claim rewards in-between these campaigns.

Traderjoe

Why We Chose It

Traderjoe offers many crypto markets and high liquidity. It is one of the largest DEXes on the Avalanche network.

Overview

Traderjoe is a decentralized exchange powered by the Avalanche network. So far, it records an average daily trading volume of $200+ million and over 60K+ trades.

Traderjoe was launched in June 2021 by two anonymous developers on Avalanche. The AVAX token is the most popularly traded crypto on the DEX, together with the exchange’s governance token, JOE.

Traderjoe offers instant crypto trading where users can trade one crypto asset against another. It has a liquidity pool where users add or remove liquidity, earning rewards in the JOE token.

There is also lending and staking available on Traderjoe. Fees begin at 0.3%—the exchange distributes 0.25% to liquidity providers, while the remaining 0.05% goes to JOE token holders on Traderjoe Farm.

Traderjoe does not guarantee users security on its platform, implying that users should apply stringent security protocols to ensure that they get the best out of the exchange. Users should also expect the occasional introduction of new features and services on the platform.

1inch Exchange

Why We Chose It

1inch Exchange grants users access to some of the cheapest deals in the market through its DEX aggregator tool, a rare offering in the decentralized exchange industry.

Overview

1inch Exchange is a DEX aggregator and decentralized crypto trading platform. Sergej Kunz and Anton Bukov founded the company in 2019 in New York. Since then, 1inch has raised funds from many investors, reaching a milestone of over $200 million trades per day.

1inch’s major offering is the DEX aggregator, which provides a platform for users to get the best deals and lowest prices in their crypto trades. The platform grants traders access to over 100 liquidity sources, with the majority coming from Ethereum, BSC, Polygon, Arbitrum, and Optimism.

1inch does not charge fees for its services. However, users may set slippages at 0.1% while trading. Additional fees may come from products and features users appreciate on the platform.

The exchange offers its 1inch token as its utility and governance token, allowing users to participate in voting and staking on its platform. 1inch also supports DeFi developers through its grants and APIs that allow them to create intuitive trading platforms.

Raydium

Why We Chose It

Raydium is one of the most popular and outstanding DEXes on the Solana blockchain network. It supports decentralized finance projects and provides order books and AMM trading models on its platform.

Overview

Raydium is a popular decentralized exchange built on the Solana blockchain and the Serum network, comprising a DEX and ecosystem of decentralized projects.

The exchange has grown to amass over $25 billion in trading volume, boasting over $2 billion in TVL. Raydium lists its utility token on centralized exchanges, with Gate.io being a major player.

The RAY token is quite profitable, surpassing over $10 in all-time highs. There are 75+ million RAY tokens in circulation, and holders can use the token to participate in Raydium’s DAO governance protocols.

Raydium uses an automated market maker (AMM) to run transactions on its platform. Users also get on-chain access to liquidity and order flow on the Serum DEX. It sets its trading fees at 0.25%, distributing 0.22% into the liquidity pool and the remaining 0.03% to staking pools.

Other services Raydium offers include yield farming and liquidity pools. These options reward liquidity providers with trading fees and RAY tokens. Raydium additionally supports decentralized finance developers looking to scale on the Solana network.

MDEX

Why We Chose It

MDEX adopts a mixed-chain ecosystem combining the Ethereum, BSC, and Huobi networks. The exchange also provides order books and high liquidity to crypto traders.

Overview

MDEX is a decentralized exchange that uses an AMM model to run transactions on its platform. Launched in January 2021, the exchange adopts a mixed-chain ecosystem combining blockchain networks like BSC, Ethereum, and HECO of Huobi.

MDEX launched an order book in October 2021, in addition to the solutions it derives from the three blockchain networks it operates. The MDX is the exchange’s utility and governance token that allows users to vote or participate in the platform’s DAO governance protocols.

MDEX offers competitive trading fees beginning at 0.30%. The exchange distributes these trading fees among liquidity providers and MDX token holders equally. 

The support for decentralized finance makes MDEX one of the top priorities for developers in the crypto community. The exchange uses the bug bounty reward approach to keep its platform secure and free of glitches.

Biswap

Why We Chose It

Biswap’s offering and desire to top the charts in the decentralized exchange ecosystem make it stand out in its services. Users can swap between Ethereum and BSC tokens on the platform.

Overview

Biswap runs on the Binance Smart Chain network offering crypto trading and farming. The exchange also grants users access to additional incentives such as staking, lotteries, and competitions.

Launched in May 2021, Biswap offers one of the industry’s lowest trading fees beginning at 0.1%. The exchange is an all-in-one solution for crypto trading, offering an additional NFT marketplace.

Users can utilize its BSW utility token to participate in DAO governance protocols and voting decisions. There’s an additional $10M incentive program and farm pool where users can add or remove liquidity, earning BSW tokens in return.

Biswap’s platform user interface and experience are great, allowing users to navigate the platform easily. There are over 30 listed tokens, plus a bridge that allows easy swapping between ETH and BSC tokens.

The DEX uses the bug bounty to keep its platform secure, a community-driven approach that comes with additional incentives. Also, Biswap aims to become one of the best-decentralized exchanges in the future by integrating innovative blockchain solutions and security protocols in its exchange.

Comparing the Best Decentralized Exchanges

Things to Consider Before Choosing a Decentralized Exchange

User Interface

Before hopping onto a DEX, ensure it has an intuitive design to enable instant activities. You may also ensure it has light and dark themes to help you navigate at any time of the day.

DEXes with well-grafted designs and UX perform better and easily attract new users or beginners. We may not say the same for those without intuitive designs that rely on their features and products to scale in the same market.

Security

DEXes have taken so many blows in the area of security. For this reason, so many traders in the crypto community are lackadaisical in putting their assets into DEXes due to fear of losing them to third-party thefts.

However, many DEXes have taken it as a challenge to audit their platforms properly. Some go to the extent of including bug bounties to enable the community to report potential problems before they affect the platform.

Trading Fees 

Although most DEXes charge competitive fees, some may subtly include on-top charges in their services. Most of the DEXes redeposit these fees into the exchange, distributing them to liquidity providers and staking pools.

Incentives

Many DEXes use incentives to attract liquidity providers and traders to their platforms. Incentives are programs or campaigns that reward users for non-trading activities they participate in on an exchange.

Examples of incentives include lotteries, staking, competitions, mining, airdrops, referrals, etc. In return, exchanges benefit when new users hop onto the platform or add liquidity through these campaigns.

Reputation

Two of the industry’s most popular exchanges, Uniswap and PancakeSwap, use their good reputations plus amazing products and features as their selling points.

Uniswap has built a reputation as one of the few Ethereum-based exchanges that have scaled through stumbling blocks in the decentralized ecosystem. So before you jump on any DEX, ensure you know what the crypto community thinks of it.

DeFi Project/Innovation 

A good DEX should support a solution or project in the DeFi industry. While some DEXes are community-driven, others should offer grants and privileges to decentralized finance developers to enable them to build intuitive dApps and software.

A good decentralized project can boost the utility token of DEX and build public awareness of the exchange. The more project a DEX supports, the more crypto enthusiast it attracts, and the more partnership it brings.

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