Navigating crypto exchanges & trading platforms – a guide to centralised, decentralised, and hybrid models

Exchanges and trading platforms are a key part of crypto infrastructure, allowing users to access, trade, and manage digital assets. In this article, Paula Albu and Mirela Ciobanu from The Paypers provide an overview of how these platforms work, their main types, and their role within the broader digital asset ecosystem.

As the digital asset industry matures, both newcomers and seasoned traders are navigating what seems to be a complex landscape of crypto exchanges and trading platforms. These platforms now come in various forms – centralised, decentralised, and hybrid – each offering distinct features, capabilities, advantages, and challenges. This rapid transformation is fuelled by technological innovation, stricter regulatory oversight, and a growing demand for optimal security, transparency, and user experience.

This article, part of The Paypers' infographic featured in the Web Payment Acceptance Report 2025 series, explores the rapidly evolving world of crypto exchanges and trading platforms. It highlights key players, technological advances, and trends shaping the industry. Whether understanding model differences, regulatory updates, or market future, this overview offers valuable insights into digital asset trading. 

Breaking down crypto exchanges – market size, models, and trends

Cryptocurrency exchange platforms have transformed the market dynamics in recent years. The crypto trading platform market is projected to grow from USD 43.1 billion in 2025 to USD 200.5 billion by 2035, at a CAGR of 14.0%.

Exchanges and trading platforms are the backbone of the global digital economy, serving as the primary infrastructure for the custody, management, and exchange of digital and tokenized real-world assets. Beyond providing essential fiat 'on- and off-ramps' and marketplace liquidity, they act as regulatory gatekeepers and integrated financial hubs, offering everything from high-speed speculative trading to passive income through staking and institutional-grade asset security.

To better understand the current crypto trading landscape, it is essential to distinguish among the three main types of exchanges: centralised, decentralised, and hybrid. Each model offers different features, advantages, and challenges for users. Moreover, recent developments continue to shape the platforms' operations, competition, and adoption.

Below, we provide an overview of each type, highlight key players, and discuss notable industry trends and strategic partnerships. 

Centralised crypto exchanges (CEXs): liquidity, compliance, and scale

Centralised exchanges (CEXs) are platforms that facilitate cryptocurrency trading, custody, and liquidity provision through a centralised entity that manages all transactions. They serve as intermediaries, offering a secure and reliable way for users to connect with one another and to exchange both fiat currencies and various cryptocurrencies.

These exchanges often optimise the trading experience with additional features such as market analysis, order matching, and wallet services to improve the trading experience.

Some of the key advantages of using centralised exchanges include intuitive interfaces, high trading volumes (which include deep liquidity), and optimal customer support. These platforms usually support a wide range of cryptocurrencies and fiat pairs, offer comprehensive educational resources, and provide mobile apps for on-the-go trading.

To comply with financial regulations and prevent illicit activities such as money laundering and terrorist financing, CEXs typically require users to complete a KYC verification.

Two of the notable players in this space in this field are Coinbase and Bybit. The platforms not only provide optimal trading and custody services but also drive innovation through strategic partnerships and new product offerings. Coinbase, has been active in forging new partnerships and expanding its services. Recently, the firm partnered with Tink to launch a new payment option that enables cryptocurrency purchases via Pay by Bank in Germany. This move may encourage broader consumer participation in the digital asset market by simplifying the purchase process.  Moreover, Coinbase invested in CoinDCX to expand regional crypto presence across India and the Middle East. This move reflects a strategy of strengthening its presence in India and the Middle East, two rapidly growing markets for digital assets.

Ranked as the second-largest exchange by spot volume as of late 2025/early 2026, Bybit holds approximately 9.5% market share. It is also a top-three player in the derivatives market. To stay compliant, last fall, the exchange announced the adoption of Nasdaq’s Market Surveillance solution to enhance the detection and prevention of market abuse across Europe.

Taken together, the efforts of Coinbase and Bybit, and their peers, underscore how CEXs are continuously adapting to user needs and regulatory developments.

Decentralised exchanges (DEXs): non-custodial trading and on-chain transparency

Decentralised exchanges (DEXs) represent a different approach to crypto trading compared to their centralised counterparts. DEXs are peer-to-peer trading platforms that enable users to trade cryptocurrencies directly with one another, removing the need for a central authority or intermediary. These platforms rely on smart contracts – self-executing code deployed on a blockchain – to facilitate and verify transactions. As a result, traders always maintain complete control over their funds and private keys, thereby optimising security, transparency, and privacy for users.

Among the key benefits of using a DEX are access to a wide variety of tokens, lower risk of large-scale hacking (since users retain custody of their assets), and optimised privacy – most DEXs do not require users to submit personal information. Furthermore, decentralised platforms are often integrating new assets and supporting emerging projects within the crypto industry. This makes DEXs a good option for users who value autonomy, privacy, and exposure to optimal developments in digital assets.

Some of the most essential DEXs include 1inch, dYdX, GMX, PancakeSwap, and Uniswap, each contributing to the sector’s rapid expansion and development. These platforms not only facilitate a wide variety of token swaps but also invest in security and user experience through ongoing partnerships and feature optimisations. For example, 1inch partnered with security providers to upgrade security measures and better protect users ' assets. Meanwhile, Uniswap teamed up with firms such as Robinhood, MoonPay, and Transak to offer users the option to sell supported crypto assets and deposit funds directly and securely into their bank accounts. While DEXs offer better privacy, as of 2026, many are now introducing ‘permissioned pools’ or optional verification layers (like Uniswap v4's ‘hooks’) to allow institutional traders to remain compliant with evolving global regulations while staying on-chain.

These initiatives demonstrate how DEXs are centring their resources to offer customers more flexible, secure, and convenient ways to interact with digital assets. 

Hybrid crypto exchanges: combining CEX liquidity with DEX control

Hybrid exchanges are platforms that combine the liquidity of centralised exchanges with the security and transparency of decentralised models. By integrating the strengths of both approaches, hybrid exchanges seek to address common pain points – such as the custodial risks of CEXs and the liquidity or usability limitations of DEXs – while providing a more adaptable and comprehensive trading environment for diverse participants.

Key features of hybrid exchanges often include on-chain settlement, security and compliance, and access to a wide range of assets – delivering performance and liquidity similar to CEXs, while enabling users to retain more control over their private keys and benefit from the transparency of blockchain operations. Many hybrid exchanges also offer advanced trading tools, flexible account structures, and integration with fiat payment systems, supporting both retail and institutional traders seeking a balance between convenience and autonomy.

Bullish, LoopRing, and rhino.fi are notable players that offer hybrid exchanges. Each of these platforms has introduced initiatives that reflect the potential of hybrid models to address evolving market needs. For example, Bullish has partnered with Deutsche Bank to expand fiat integration for institutional crypto trading, and has received USD 1.15 bln in IPO proceeds held in stablecoins – to support its growth and operational resilience.  Meanwhile, Rhino.fi partnered with Monetic to offer instant bankless payments across borders. The developments underscore the growing institutional and commercial interest in platforms that combine the efficiency and scale of CEXs with the transparency and user empowerment of DEXs.

To sum up, today’s crypto exchange landscape is characterised by a variety of platforms – centralised, decentralised, and hybrid – each designed to meet different user needs and preferences. While centralised exchanges offer liquidity and ease of use, decentralised platforms offer greater control and privacy, and hybrid models aim to bridge the best of both worlds. As regulations tighten and user demand shifts, these exchanges are rapidly innovating, introducing new features and creating partnerships to stay competitive. 

Understanding liquidity aggregators and market makers in crypto trading

As the digital assets ecosystem expands, efficient trading relies not only on robust exchanges but also on the mechanisms that ensure optimal market operations. Liquidity aggregators and market makers have become essential components of the crypto infrastructure, providing liquidity to trading platforms, underpinning price stability, and enabling optimal transactions for all participants.

Liquidity aggregators are platforms that source liquidity from multiple venues to optimise trading execution. They refer to the process of combining liquidity from various sources into a single pool to create a unified marketplace for buyers and sellers. This approach addresses some issues that can occur: market fragmentation (consolidating liquidity from different sources can solve this problem), reducing slippage (slippage occurs when a trade is executed at a different price than expected due to insufficient liquidity), or risk diversification (relying on a single liquidity provider exposes traders to counterparty risk).

Some of the most notable players in the liquidity aggregation space include:

• Market Makers (MM): These firms are primarily market makers and liquidity providers (like Amber, DWF Labs, GSR, Kairon, and Keyrock). They use their own capital to quote buy and sell prices to ensure market depth.

These firms are focused on building trust in the fintech industry by prioritising regulatory compliance and strategic partnerships. For example, Keyrock recently secured FCA registration for regulatory credentials and a partnership with Deutsche Bank to optimise global digital assets operations. Similarly, GSR Markets received a Singapore licence for crypto trading.

• Liquidity Aggregators: These are typically software platforms or protocols (like 1inch, Paraswap, or CowSwap) that scan various exchanges to find the best price for a trader. While market makers provide the 'fuel' (liquidity), aggregators are the ‘engines’ that find it.

DeFi liquidity aggregators, meanwhile, are platforms specially designed to source liquidity from multiple DEXs, ensuring users can access the most competitive prices and lowest possible fees. 

Key features include automated yield compounding, optimised swap rates with lower gas fees, cross-chain functionality, and unified portfolio views.

The most well-known DeFi liquidity aggregators are Matcha, OpenOcean, and ParaSwap. They have set the industry benchmarks by offering trading tools. Matcha, for instance, is known for its intuitive user interface and comprehensive feature set, making it a popular choice among both novice and advanced traders looking for optimal execution and streamlined portfolio management.

In summary, liquidity aggregators and market makers play a pivotal role in optimising market efficiency, reducing volatility, and supporting the expansion of digital assets. 

Trends and outlook – what’s next?

As the digital asset ecosystem matures, liquidity aggregators and market makers are moving from behind-the-scenes facilitators to important infrastructure providers at the centre of crypto trading. Now, they play an important role in shaping efficiency, transparency, and resilience across both centralised and decentralised markets.

Institutionalisation and regulation alignment

A defining trend in the space is the rapid institutionalisation of liquidity provision. Important aggregators and market makers are actively pursuing regulatory licences, such as FCA registration in the UK or digital asset licences in Singapore, to meet evolving compliance standards and build trust with institutional clients. This move is also fostering the development of a robust framework, advanced risk management practices, and transparent reporting, optimising the movement of assets across multiple chains and platforms. 

Security and transparency

Partnerships between exchanges and traditional financial institutions indicate the development of institutional-grade infrastructure, which features rigorous compliance measures, insurance protections, and secure custody solutions.

User empowerment

All crypto exchanges and trading platforms are pushing for non-custodial control, privacy, and accessibility, shaping a more user-centric financial future.

Integration with TradFi

Collaborations between exchanges and banks illustrate the accelerating convergence of TradFi and crypto, resulting in a unified digital asset ecosystem that combines the strengths of both sectors.

Technology-driven innovation

From this perspective, aggregators are rapidly adopting advanced algorithms. AI-driven analytics and automation to optimise execution quality and manage risk in real time. Features such as automated yield compounding, cross-chain swaps, and unified portfolio management are becoming standard across DeFi aggregators. These features are paving the way for new financial products and a more optimal digital asset market. 

Overall, liquidity aggregators and market makers are emerging as mandatory enablers of the crypto’s next phase. Their evolution is driving greater efficiency, transparency, and accessibility, features that are fundamental for institutional adoption, regulatory confidence,  and mainstream user participation. 

 

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