TL;DR
- Coinbase added a decentralized exchange feature to its app, allowing users in the United States to swap on-chain assets directly.
- The feature uses an integrated self-custodial wallet and DEX aggregators like 0x and 1inch, making it easier to access liquidity without withdrawing funds from the platform.
- Users can trade using their exchange balances or USDC, connecting centralized trading with decentralized networks.
Coinbase integrated a decentralized exchange function within its application, enabling users in the United States, except for New York residents, to conduct direct transactions with on-chain assets.
This feature relies on an integrated self-custodial wallet that allows trading without the need to move funds off the platform. The integration includes DEX aggregators such as 0x and 1inch, which improve access to liquidity available across various pools within the blockchain network.
The option to use balances on Coinbase or USDC simplifies the experience, as users can perform swaps without transferring their assets to external services. This update will enhance connectivity between the centralized system and decentralized networks, bringing traditional exchange volumes into a safer and more transparent environment. Direct blockchain transactions reduce intermediaries and allow users to benefit from decentralization advantages.
Coinbase: Decentralization Backed by Reputation
Coinbase aims to promote a decentralized finance model that also adapts to regulatory restrictions present in some regions, such as New York. Excluding that state shows the company’s attention to complying with existing regulations. Meanwhile, U.S. users gain access to a faster mechanism for token trading, combining the security of a well-known exchange with the flexibility of on-chain trading.
Market experts have noted that this integration could affect volumes and liquidity of digital assets, although they warn that lower-cap tokens may experience greater short-term volatility. Uniswap’s experience, which launched a similar mobile service in 2021, demonstrates that incorporating DEX features within established apps tends to increase direct user participation in swaps and boost total value locked in decentralized protocols.
With this feature, Coinbase offers an alternative that combines the benefits of a centralized exchange with the transparency and control typical of decentralized finance. It allows users to leverage liquidity and a variety of options available across different chains without losing the convenience of operating from a recognized platform
