What a crypto exchange is
A crypto exchange (Binance, Bybit, OKX…) is a marketplace where you buy and sell coins. Unlike a broker's account, coins there are held by the exchange until you move them out.
A marketplace for coins
On an exchange you swap money for coins and coins for each other: dollars for bitcoin, bitcoin for ether. Prices move every second, set by everyone buying and selling.
Who holds the coins
While coins sit on an exchange, the exchange holds them for you. That's convenient, but if the exchange fails or freezes withdrawals, your coins are stuck with it. Many people keep only what they trade on the exchange and move the rest to their own wallet.
Stablecoins
Coins like USDT and USDC are built to stay worth one dollar. People use them to park money on an exchange between trades.