Basic definition
An exchange is a platform that facilitates operations involving digital assets. Depending on the service, it may include conversion, buying, selling, deposits or withdrawals.
Centralized and decentralized
A centralized exchange is operated by an organization and usually manages accounts. On a decentralized exchange, certain functions are performed through smart contracts and compatible wallets.
Important concepts for understanding an exchange
Useful concepts include custody, asset pairs, order books, liquidity, supported networks, fees, limits and official support channels.
Deposits, withdrawals and networks as concepts
Platforms may use different networks to represent an asset and apply different technical rules. Studying that architecture helps explain how the platform works.