DEX (decentralized exchange)

A DEX (decentralized exchange) is a smart-contract system that lets users trade tokens on-chain without depositing funds to a centralized service. The two main designs are automated market makers (AMMs) — like Uniswap and Curve — which price trades using pools of paired assets and a mathematical curve, and on-chain order books, which are rarer because they are expensive to run at scale.

The user experience is: connect a wallet, pick a trade pair, sign a transaction, and receive the destination token in the same wallet. There is no account, no deposit, no withdrawal — the trade is a single on-chain transaction. This eliminates the "the exchange is holding my money" risk of custodial exchanges, at the cost of paying gas per trade and being exposed to the pricing of the liquidity pool you route through.

DEXes are the dominant venues for trading within a single chain (especially Ethereum and its L2s), but they do not handle cross-chain trades natively. Bridging assets between chains still requires a bridge protocol, which introduces its own trust assumptions. Aggregators like SwapZilla route cross-chain — combining execution venues across chains where needed.