There are a number of advantages that make NCEs an appealing alternative to both centralized and decentralized cryptocurrency exchanges.
User control: Firstly, users maintain control of their own crypto wallets, private keys and holdings. Some platforms allow users to remain anonymous by not requiring any documentation for account creation, others require customers to complete Know Your Customer (KYC) verification.
Variety of crypto trading pairs: NCEs essentially act as aggregators of cryptocurrency trading pairs. They do not require users to deposit funds or crypto holdings and provide a wide range of trading pairs.
Security: By not having to store funds on an exchange, users don’t need to worry about their cryptocurrencies being stolen or lost. Furthermore, most exchanges do not collect user identity information, which allows for the retention of anonymity.
Speed: In comparison to decentralized exchanges, NCE’s boast much faster conversions and trades for users. This is mainly due to their access to a wide range of centralized exchanges that have large trade volumes and a variety of cryptocurrencies.
Low costs: Another major drawcard of NCEs are similar trading fees to regular cryptocurrency exchanges. Since most exchanges charge substantial fees for withdrawal of funds, and a user would be paying mining fees several times to transfer the funds from and back to a wallet, in some cases it may be cheaper to use NCEs, especially given the fact that far fewer steps will need to be taken to convert crypto.
User-friendly experience: NCEs provide users with an experience similar to that of the most popular centralized exchanges. This essentially creates a middle ground where users can enjoy easy-to-use applications and platforms while maintaining full control of their private keys and crypto holdings.
Trades are made on the user’s behalf and the user receives the cryptocurrency directly into their own wallet. Furthermore, some of these NCEs have easy-to-use mobile apps, like Changelly, which makes them more appealing to users who wish to keep control of their private keys.
Also, Shapeshift recently announced support for hardware wallets, which allows users to keep their crypto in a highly secure wallet while retaining the ability to quickly send and receive crypto on the platform.