2 Reasons Why Blockchain is Essential for Decentralized Exchanges (DEXs)

'Decentralization': A DEX operates without any central authority or intermediary, and the transactions are directly executed between the users. This requires a decentralized platform, which can ensure transparency, security, and immutability of the transactions. A blockchain-based system can provide these features as it is decentralized, and the transactions are recorded on a distributed ledger, which is immutable and resistant to tampering.

'Smart Contracts': Smart contracts are self-executing contracts with the terms of the agreement between the parties being directly written into lines of code. They facilitate, verify, and enforce the negotiation or performance of a contract. A DEX requires a smart contract system to execute the trades, and a blockchain-based platform can provide this functionality. The smart contracts can also provide additional features such as escrow, time-lock, and multi-signature, which can enhance the security and reliability of the transactions.