Centralized and Decentralized Money پول متمرکز و غیر متمرکز

Centralized & Decentralized Money

Centralized and Decentralized Money

Centralized and decentralized money are among the concepts related to the field of digital currency. Today, we are no longer faced with the common concept of money. In other words, money has lost its former and common meaning and is not exclusively at the disposal of an organization or network. The emergence of decentralized money and currencies has brought economic activities into a new environment. People who are active in the cryptocurrency market should be relatively familiar with concepts such as centralized and decentralized wallets. Otherwise, the security of their capital will face the risk of destruction in the cryptocurrency market.

Digital Currency Wallet

We use physical wallets to store our notes. But in relation to digital wallets, the case is different; Because our property cannot be physically stored in the wallet. In this regard, digital currencies such as Bitcoin are stored on the blockchain and in return we receive private keys that show our ownership of digital currencies. In a way, it can be said that private keys in relation to decentralized wallets are like bank card passwords. This wallet allows holders to store, manage and send their cryptocurrencies. Digital wallets are divided into two categories, centralized and decentralized, which will be explained below.


Centralized and Decentralized Money پول متمرکز و غیر متمرکز
Digital Currency

Centralized Wallet

The centralized wallet system is somewhat similar to the banking system. In addition to ourselves, the management of its assets is also done by third parties. Exchanges such as Binance that use this type of wallet know the private keys associated with the wallet. When we issue an order to our digital wallet to send or receive or store a digital currency, the executioner of these orders is a third party.
This process is similar to the banking system, which, in addition to keeping assets, also has accessibility. On the surface, it is easier to work with the centralized system of wallets, but it also has conflicts with the decentralized nature of the cryptocurrency market.

Decentralized Wallet

In the decentralized wallet, all actions for asset management and maintenance are done by the owners. In fact, the system that provides these services does not have access to the private key at the same time as the main user. As a result, in this wallet, we are faced with the elimination of the role of a third party in managing, maintaining, sending and receiving digital currencies. Decentralized currencies have no issuing authority and peer-to-peer technology is used in its transactions. But the most important point in this case is to have expertise that we can rely on to guarantee the security of our wallet. Therefore, if we are considered beginners in this field, this option will not be suitable for us.

Advantages and Disadvantages of Centralized and Decentralized Currency

Centralized currencies are controlled by a single entity, while decentralized currencies are independent and not under official supervision and control. Any person can create a decentralized currency and it is not monitored and controlled by any institution.

Centralized currencies are more stable because they have value stability and have the ability to store value. However, such currencies are more vulnerable to fraud, hacking and government interference.
Decentralized currencies are less stable due to continuous value changes. But in terms of security, they have more favorable conditions; Because they cannot be manipulated or hacked.

Decentralized currencies provide anonymity for users. This is while centralized currencies do not have such privilege due to the control of the central bank.

Best Decentralized Wallets


Centralized and Decentralized Money پول متمرکز و غیرمتمرکز
Decentralized Money (D.M)
1. Trust Wallet

This wallet is one of the most reliable digital currency wallets in the decentralized space that is used the most. The effectiveness of this wallet is felt more for people who want to use Volt in their mobile phone. Professional traders in this field, mostly offer this type of wallet; Because it is a more appropriate choice for doing short-term transactions and keeping small assets.

2. Meta Mask Wallet

This example is also one of the most widely used. Its mobile version is also available, which provides the possibility of easy use for users. What has made this wallet popular is its high security.

3. Trezor T model wallet (Trezor T)

This example can be mentioned among hardware wallets. This wallet is considered one of the most practical due to the support of micro USB memory and digital display screen. In addition, the support of hundreds of digital currencies has made this wallet the best wallet.

4. Ledger Nano X Wallet

It is considered one of the most accepted wallets for performing various transactions in the digital currency market. Connecting this wallet to both computers and mobile phones has made it easier for users. Support for 1800 cryptocurrencies is another feature that facilitates transactions for traders. Because this wallet has special software and features, it provides instant access to assets.

5. Valium Wallet

The way this wallet works is encrypted and on the web. One of the attractive features of this wallet is its lack of access to security information such as private keys. In this wallet, there is a possibility of backing up the accounts so that users can recover their money if necessary. One of the weak points of this wallet is that it does not have special software for the computer.

Up To Sum

Centralized and decentralized money are new concepts in the cryptocurrency trading space. Each of these two concepts has advantages and disadvantages. However, familiarity with the capabilities of each is necessary and necessary for the activists of this field. Despite the security that decentralized currencies seem to have and despite the lack of access to private keys, in practice restrictions are imposed on these cryptocurrencies through laws and regulations.


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