Centralised exchange (CEX)

A custodial trading platform operated by a company, where users deposit assets into addresses controlled by the platform and trade through an internal order book or directly with the platform as counterparty. Movements between customer accounts on the same platform are recorded in its internal ledger rather than on-chain. Some internal transfers, including transfers between users or withdrawals to addresses controlled by the same platform, may therefore occur without an on-chain transaction. As custodians, exchanges can restrict access to accounts and assets held on the platform; regulated exchanges are also subject to applicable KYC and information-sharing obligations. When funds leave the platform, tracing may require the exchange's internal records to establish the subsequent recipient or movement.