CZ: It is expected that CEX and DEX will coexist in the long term, with the current world crypto adoption at a depth of less than 1%

Feb 12 — Binance founder CZ said during an AMA session: I believe centralized exchanges (CEXs) and decentralized exchanges (DEXs) will coexist long-term — like, really long-term. At least from what I see now, they cater to two totally distinct user bases. DEXs operate directly from your wallet, and self-custodying your wallet is still a specialized skill right now. Most folks can’t safely manage their own wallet security. If you’re actively trading on a DEX, you need an extremely secure computer. That means you can’t just casually download files online or open pics a friend sends you — you have to put strict limits in place to keep your computer truly “clean” and make sure it never gets hacked or infected. If your wallet’s on that machine and it gets compromised, you’re in serious trouble. These users are totally different from those who use CEXs. For CEXs, all you need is an email, a password, and access to customer support. On top of that, crypto adoption is still pretty low overall. In terms of user counts, I think it’s probably in the single digits: around 8-10% of people worldwide might hold some form of crypto. But when it comes to wealth distribution, the share of crypto in their total assets is likely less than 10%. That means globally, the “depth” of real crypto adoption is probably under 1%. For most regular users (not tech pros) getting into crypto for the first time, they’ll start with a CEX. Then, as they get more knowledgeable, they might move to DEXs. Right now, many early crypto adopters are tech folks — what I call “tech geeks.” These people are more inclined to use DEXs. For other mainstream users, though, switching to DEXs is actually pretty tough. That said, tools will improve over time.