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How Does an AMM Differ from a Centralized Exchange (CEX)?

CEX uses an order book and central authority; AMM uses a smart contract pool and algorithm for decentralized trade.
Greeks.Live29.10.25

How Does an AMM Differ from a Centralized Exchange (CEX)?

A CEX uses a traditional order book model, matching buyers and sellers, and is run by a central company. An AMM is decentralized and uses a smart contract-based liquidity pool and an algorithm to facilitate trades.

AMMs offer permissionless trading directly against the pool, eliminating the need for a centralized intermediary.

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