A crypto exchange is a place where people can exchange cryptocurrencies. There are two types: a centralized exchange and a decentralized exchange.
Cryptocurrencies are continually changing in value, and people will trade one for another to try and make some extra money. If you have ever traded stocks, you can think of it much the same way. Some crypto exchanges allow you to exchange one crypto for another, and others will require you to cash out and purchase with different funding methods.