1inch Exchange Review: Leading DEX Aggregator

Decentralized Finance has exploded in the past few years, so it’s no wonder that so many DEXs and liquidity pools are operating and popping up. To better gauge the scale of DEXs operating in DeFi these days, have a look at the ‘Categories’ page on DeFiLlama, which lists over 1300 unique DEXs locking about $21 billion in value.

Keeping track of them all and which are offering the best trading conditions can be an absolute nightmare. And that’s where the 1inch Exchange is so interesting.

The 1inch Exchange calls itself the “Leading DEX Aggregator,” and we agree. It also has liquidity pools, and users can farm the native 1INCH token on the platform. That 1INCH token is also interesting as an instant governance token.

1inch Exchange Pros & Cons

As a short introduction to the strengths and weaknesses of the platform, we include these pros and cons to get started for your consideration:

Like so many other Ethereum-based projects, 1inch emerged from an ETH dev conference. This time, it was at the ETHGlobal hackathon in 2019. It was founded by Sergej Kunz, the CEO of 1inch, and Anton Bukov, its CTO.

In August 2020, they completed a Seed round from Binance Labs of about $2.8 million. Then, in early December 2020, they closed a much larger $12 million funding round led by Pantera Capital. As of Dec 2, 2021, they managed to raise $175 million led by Amber Group with participation from other known crypto VCs such as Fenbushi Capital, Alameda Research and other blockchain projects such as Celsius and Nexo, as reported by CoinDesk. 

Initially, the founders of 1inch Exchange created a separate portal for yield farming called Mooniswap. It was basically a Uniswap clone. Since December 2020, that portal has been deprecated as the 1inch Liquidity Protocol was launched. Now, the experience of using 1inch is similar to any typical DEX, like Uniswap, the difference lies under the hood. Unlike standalone DEXs, 1-inch finds the best swap path by analyzing pathways across several DEXs.

The following review will explore the features available at the 1inch exchange and explain how to make an exchange or provide liquidity to the pools. There’s a lot to cover, so let’s dive in.

What is 1inch Exchange?

The 1inch exchange is a decentralized exchange, or DEX, aggregator. Rather than working as an exchange itself, it splits orders between other DEXs and private liquidity providers to find the best possible exchange rates. In its current state, 1inch supports over 389 liquidity sources from 11 blockchains and 6.7 million users.

At 1inch Exchange, connecting a web3 wallet and then swapping ERC-20 tokens at the best possible rates is a simple process. The exchange will even split orders between several exchanges if that’s what it takes to get the best rate for an entire order.

It is also possible to create limit orders at 1inch, earn by staking 1INCH tokens, and supply liquidity to the 1inch liquidity pools.

1inch Order Routing

1inch uses a proprietary API they’ve named Pathfinder, which contains a discovery and routing algorithm. Pathfinder finds the best possible paths for any proposed token swap, splitting a swap across several exchanges and even across different market depths of the same exchange if necessary. Furthermore, with the dynamic fill mechanism, amounts in the exchanges with the unfavorable rate gets moved to the ones with favorable rates even when processing the transaction. As a result, the exchange rate and/or gas fees a user receives are better than what they would have gotten on any single exchange.

The addition of Pathfinder was the major part of the upgrade to 1inch version 2. Pathfinder uses different' market depths' as bridges between source and destination tokens. Therefore, the algorithm uses a more sophisticated approach than just splitting a swap across different protocols. In addition, it can split part of the swap for a specific protocol between different' market depths' on the same protocol, getting the user the best rates, also taking into account gas consumption.

1inch Aggregation Protocol v5

A key linchpin in 1inch's offerings is the Aggregation Protocol. It allows for splitting a single transaction into multiple DEXs in search of the best rates. Since its inception, new developments have emerged, giving it more oomph. The most significant improvement in the latest version is the substantial reduction of gas fees.

The 1inch Router v5 introduces several key enhancements designed to optimize decentralized exchange (DEX) transactions on the Ethereum network, significantly improving efficiency and reducing costs for users. Here are the main updates and features of the new version:

• Increased Gas Efficiency for Swaps: The new router offers substantially more gas-efficient swaps. Specifically, it achieves approximately 5% greater gas efficiency compared to its predecessor (Router v4) and is 10% more efficient than the closest competitor in the DEX market. This means that users can expect to save on transaction fees, which is crucial in high-volume trading environments.
• Integration with 1inch Limit Order Protocol v3: Router v5 has been merged with the 1inch Limit Order Protocol v3, enhancing the overall swapping efficiency and further reducing gas costs. The Limit Order Protocol has become a significant component of the DEX market, currently holding about 40% of the market share.
• Improved Interaction Logic: The new version features a revamped interaction logic with the addition of pre- and post-interactions. This update allows for more complex and flexible transaction structures, potentially opening up new strategies for users.
• Enhanced Smart Contract Error Handling: An improved error processing system has been implemented, including the introduction of custom error messages. This provides users with clearer, more specific feedback on why an operation may have failed, improving the user experience and aiding in troubleshooting.
• Security Audits: Prioritizing security, the new router has undergone extensive audits by almost a dozen reputable entities in the industry, such as Consensys, OpenZeppelin, and ABDK Consulting. This thorough auditing process ensures that the router is robust and secure against potential vulnerabilities.
• Vulnerability Rewards Program: Continuing its commitment to security, 1inch offers rewards for reporting vulnerabilities in Router v5. This incentivizes the community to help maintain and improve the router's security.

Overall, the 1inch Router v5 represents a significant upgrade, focusing on cost-efficiency, security, and user flexibility. It solidifies 1inch's position as a leader in the DEX market by enhancing the trading experience and offering potential cost savings through improved gas efficiency.

Limit Order Protocol V3

The 1inch Limit Order Protocol v3 introduces several significant enhancements and changes that improve its efficiency and flexibility:

• Unified Order Structure: The new version integrates traditional limit orders with high-performance RFQ (Request for Quote) orders into a single, more efficient protocol. This update makes the orders up to 14% more gas-efficient for upgraded limit orders and 3% more gas-efficient for RFQ-like orders​.
• Enhanced Interaction Logic: The protocol now supports complex interactions within the order structure, including concatenated sequences of maker and taker asset data, and pre- and post-interactions. This allows for more sophisticated order configurations and can handle multiple interactions efficiently​​.
• Advanced Error Handling and Security Features: The update introduces a more robust error handling mechanism, enhancing the security and user experience by providing clearer feedback on transaction failures. The system now includes better support for permit2, allowing trades without token approval if the same token was previously approved in other DeFi projects, thus streamlining the trading process and enhancing security​.
• Flexible and Dynamic Order Management: Changes to the order structure include modifications to how orders are filled, such as replacing multiple specific parameters with more flexible ones that can adapt to different trading scenarios. This makes it easier for developers to implement and customize features according to specific needs​​.
• Improvement in Order Execution: The protocol now allows for more granular control over order execution, accommodating complex scenarios like executing multiple orders with the same nonce without requiring repeated approvals. This is especially beneficial for users who engage in high-frequency trading or need to manage a large number of orders simultaneously​​.

These updates are aimed at making the 1inch Limit Order Protocol v3 not only more efficient but also more adaptable to the needs of diverse trading strategies in the DeFi ecosystem. For developers and traders looking for a highly flexible and efficient trading protocol, these enhancements provide substantial improvements over previous versions.

1inch Exchange Fees

One of the positives of using 1inch aggregator is its complete absence of fees. There are no exchange fees, no deposit fees, and no withdrawal fees. The only costs for users are only dependent on the decentralized exchanges used to source liquidity for trades, and 1inch even does its best to limit these as much as possible through the use of "Infinite Unlock" and the CHI Gas Tokens.

For example, the Uniswap exchange has a flat fee of 0.3% for its orders, and Balancer charges a variable fee depending on which pool you're entering. In general, nearly no DEXs are offering fee-free trades. The native 1INCH token is not just a utility token but also provides governance for the platform, and rewards on 1inch are now wholly reliant on DAO proposals and voting.

One of the greatest benefits of using the 1inch Exchange is how it can lower the gas fees paid for transactions. When gas fees go out of hand during demand, it is increasingly important to minimize gas fees.

The 1inch Token

The 1INCH token is much more than an ERC-20 utility token for the 1inch Exchange. It is an instant governance token used to provide governance to the DEX aggregator and liquidity protocol.

Holders of the 1INCH token, no matter the amount, can use their voting power to decide on various parameters of the 1inch protocol. These include the governance reward, the swap fee for the liquidity protocol, the price impact fee, and the decay time for the exchange. These parameters are found under the DAO tab of the 1inch Exchange website. Users can also go here to vote on current proposals.

The total supply of 1INCH tokens has been set to 1.5 billion, with 30% of that allocated to the 1inch community. The 1inch team has chosen to distribute these community tokens via airdrops, and the total supply is planned to be distributed over 4 years.

The remaining token supply will be used for development (14.5%), of which 8% of that was given to investors during its latest funding round. The rest will gradually be distributed to the early investors and team members (55.5%).

The token is issued by the 1inch Foundation, a non-profit organisation established to foster the 1inch Network and its burgeoning community. Some of its activities include:

• Engage early adopters
• Encourage users to stake 1inch in governance proposals
• Issue development grants for projects benefiting the 1inch protocol, which also includes yield-farming initiatives.

1inch Tokenomics

The 1inch token currently has a circulating supply of 1,158,304,896 out of 1.5 billion tokens. Its market cap sits at $422,210,226 with a TVL of $5,243,661 in May 2024. It hit an all-time high of $7.45 in May 2021.

While it looks to be a gradual downward dip since the high in October, with the range of innovations coming from the team, all it may take is another notable partnership or two to drive its price up.

1inch DAO

Unlike other protocols with DAOs, there is no minimum requirement for holdings at 1inch. Users with any 1INCH tokens are free to vote and have a say in the potential changes to the protocol parameters and governance proposals. They do so by staking their 1inch tokens, basically putting their money where their mouth is.

There are two phases to the DAO's implementation. The first phase kicked off in December 2020. In this phase, the 1inch tokens were distributed to community members according to a lockup release schedule. The core community members play an essential role in ensuring the governance is done efficiently as the process stabilizes and matures.

In the second phase, the team moved towards enabling complete governance control and the treasury to the DAO. Two types of voting tokens emerged with different voting powers.

• st1INCH tokens, synthetic non-transferable versions of the staked 1inch tokens in proposals, have full voting power.
• v1INCH tokens, representing the 1inch tokens locked in vesting contracts, have 1/5th the voting power of st1inch.

Buying 1inch Tokens

In the early days of the protocol's launch, the only way to get your hands on the 1inch token was to have some crypto on hand to swap them within DEXs or at the 1inch Exchange. It feels a bit like doing a transaction in a shady alley. The only major CEX to get it then is Binance. Since then, it's gotten listed in major CEXs such as Coinbase and Kraken, to name a few. This gives the token a lot more cache as a legit token for those who know little about it. More importantly, entrance to these exchanges allows for purchasing the tokens with fiat, not just crypto. That widens the token's access to the masses, which is a desirable situation for the 1inch team.

1inch Airdrops

One of the things that created the initial excitement and buzz around the 1inch Exchange was its choice to airdrop tokens as part of the token launch.

As part of that airdrop, all wallets that interacted with 1inch until December 24, 2020, at midnight (UTC), received 1INCH tokens as long as they met one of the following conditions:

1. at least one trade before September 15, 2020;
2. at least 4 trades in total;
3. trades for a total of at least $20.

As a result, 90 million tokens were airdropped on Christmas Day 2020. A short while later, on February 12, 2021, the second airdrop of 6 million tokens was made to Uniswap users. The marketing ploy delivered tokens to Uniswap users who met the following criteria:

• Traded at least 20 days on Uniswap;
• Placed at least 3 trades in 2021;
• No bots allowed.

 Early adopters of 1inch were quite pleased by the surprise airdrop. Image via 1inch blog. 

There was also a second airdrop of 9 million 1INCH tokens to members of the 1inch community who were overlooked during the first airdrop. The distribution scheme applied to Mooniswap (revamped to 1inch Liquidity Protocol in December 2020), some wallets with transaction relayers and limit order users, and some liquidity providers to 1inch pools who did not receive it tokens they were entitled to in the initial Christmas distribution.

The most recent 1inch airdrop occurred on September 6, 2022, when 1inch distributed 300,000 OP tokens to its users on the Optimism network This particular airdrop was aimed at encouraging activity and boosting user engagement on the Optimism layer-2 scaling solution, which helps to enhance transaction speeds and reduce costs on the Ethereum network​​. To find out about new airdrops and liquidity mining programs, keep an eye on the 1inch Exchange blog or other social channels.

1inch on Other Chains

On February 25, 2021, the 1inch Foundation deployed the 1INCH token on the Binance Smart Chain, making the 1inch Aggregation Protocol and the 1inch Liquidity Protocol available to BSC users.

 Adding a bridge to the Binance Smart Chain was a smart move. Image via 1inch blog. 

The 1INCH token on Binance Smart Chain will be used for a bridge between the Binance and Ethereum networks. When a user sends 1INCH tokens to the BSC, they will be locked in Binance Bridge, and a corresponding value in 1INCH tokens on Binance will be consequently unlocked. Thus 1inch users will get access to PancakeSwap and other BSC based decentralized exchanges and lending protocols.

There have been 10 million 1INCH tokens initially issued on BSC, and they will be used as liquidity in Binance Bridge for transactions between Ethereum and the Binance Smart Chain.

1inch is designed to work on any EVM-capable blockchain. The networks it is currently live include Ethereum, BNB Chain, Polygon, Arbitrum, Optimism, Gnosis Chain, Avalanche, Klaytn, Aurora, zkSync Era and Fantom.

Other Bridges on 1inch

1inch has also introduced bridges to different networks, allowing users to freely move their tokens to other networks at a low fee. The bridges currently supported are Gnosis, Polygon, Arbitrum, Optimism, BNB Chain, Fantom, Klaytn, Aurora, zkSync Era, Base and Avalanche, in addition to the BNB bridge mentioned above.

After selecting a bridge, you will be brought to the respective network and be asked to connect your Web3 wallet to the site. Once there, select which tokens you would like to bridge over, then hit the "Transfer" button.

Staking the 1INCH Token

While the most essential function of the 1INCH token is its governance feature, it also has a staking feature that lets any 1INCH holder stake the coins and make more 1INCH tokens. Tokens can easily be staked by going to the DAO tab on the website and then navigating to the Governance section.

Those who choose to stake their 1INCH tokens receive rewards from the swap fee and the price impact fee. Plus, those who hold the 1INCH token have the right to vote on both these parameters, and when voting, holders also receive governance rewards.

Staking 1INCH tokens is quite simple. First, you need to acquire some 1INCH tokens if you don’t already have some. Then navigate to the 1inch Exchange and click on the DAO tab. Once on the DAO page, go to the Governance tab if not already there. Next, find the token staking box in the upper right section of the page and click on the button to Connect Wallet.

 Staking is easy at 1inch Exchange. Image via 1inch.exchange 

Once the wallet is connected, you enter the amount of 1INCH tokens you’d like to stake and then unlock them. You can use the regular “Unlock” or choose to use the “Infinity Unlock” feature. The Infinity Unlock will save you from paying gas for this transaction again, but it could present a security risk if it is ever exploited.

You can also click the settings icon in the upper right corner of the staking box to change the gas cost between Standard, Fast, and Instant. Of course, once staking is unlocked, you can always stake more by making a last transaction.

1inch Fusion 2.0 Upgrade

1inch Fusion 2.0 is a significant upgrade to the decentralized exchange platform, enhancing the efficiency and speed of cryptocurrency swaps. Launched in December 2022, Fusion 2.0 allows users to execute token swaps across various networks without incurring gas fees. This system leverages a network of resolvers—professional and verified traders who compete to provide the most favorable swap rates, thus ensuring users benefit from the best available prices.

The platform utilizes an intent-based approach where users specify their swap intentions, and resolvers use optimized strategies to execute these swaps efficiently. This model also includes a partial fill functionality, enabling large swaps to be completed in segments by different resolvers, often resulting in better rates than those available through standard market swaps.

Significant to Fusion 2.0 is the elimination of the settlement contract layer, replaced by a more streamlined interaction directly with resolvers, which reduces costs and improves token swap prices. Additionally, 1inch has integrated a price curve adjustment feature that responds in real-time to fluctuations in market gas prices, reducing the likelihood of order expiration and speeding up transaction times.

With these innovations, 1inch Fusion 2.0 not only cuts swap costs by 10%-35% compared to its previous version but also outperforms other market offerings by about 10%. This makes it an attractive choice for both small-scale traders and large-volume users seeking to maximize their trading efficiency and cost-effectiveness. Fusion 2.0 is readily available in the 1inch dApp, along with an API for developers looking to integrate these capabilities into their own projects.

1inch Wallet

The 1inch Wallet is a non-custodial cryptocurrency wallet facilitating seamless interaction with the decentralized finance (DeFi) ecosystem. It integrates a decentralized exchange (DEX) aggregator to ensure users receive optimal trading rates from over 250 liquidity sources. This wallet supports multiple blockchains, including Ethereum, BNB Chain, and Polygon, providing flexibility in managing various digital assets and executing transactions across different networks.

Key features of the 1inch Wallet include a fiat-on-ramp service, allowing users to buy cryptocurrencies directly with fiat currencies within the wallet. This enhances convenience for both beginners and seasoned traders. The wallet also supports text recognition to easily import existing wallets using private keys or seed phrases, streamlining the setup process.

Security is a paramount aspect of the 1inch Wallet, which features technologies such as Secure Enclave for iOS users and comprehensive audits by Blue Frost Security to ensure robust protection against potential vulnerabilities. Additionally, the wallet employs Flashbot transactions to mitigate front-running risks that are common in DEX transactions.

Users benefit from features like gas customization, which allows them to control transaction costs and speeds, and slippage tolerance settings to manage the price variance in trades. The partial fill feature reduces the risk of transaction failures due to price changes during a swap. Moreover, active users can receive refunds on gas fees through a staking program, further reducing the cost of operations.

The 1inch Wallet also includes a built-in Web3 browser, providing direct access to a wide range of dApps and a news digest for the latest crypto updates. This makes the 1inch Wallet a comprehensive tool for engaging with the broader DeFi landscape, offering both security and efficiency in managing digital assets. The wallet is also integrated with Apple Watch and other non-DeFi sites like Coingecko, CoinMarketCap and Dune Analytics, in addition to blockchain networks such as Polygon, Ethereum and the Brave Browser.

Other Supported Wallets

As 1inch is a decentralized exchange aggregator and liquidity provider, there is no requirement to create an account to trade through them. All that's needed is to connect a supported wallet to the exchange and fund it with supported ERC-20 tokens. There are never any third parties between your wallet and the exchange.

The 1inch Exchange does support several wallets for swapping tokens. The wallets supported include MetaMask, TrustWallet, MEW, WalletConnect, and the Ledger hardware wallet.

The 1inch Exchange can be used with several web-based, mobile, and hardware wallets, depending on your preference. Below we show you how to use the 1inch Exchange with the MetaMask wallet.

1inch RabbitHole Security Feature

1inch RabbitHole is a security feature integrated within the 1inch platform. It's designed to protect users, particularly those using MetaMask, from potential sandwich attacks during their transactions. Sandwich attacks occur when a malicious actor observes a pending transaction and places their own transaction both before and after it in the block, benefiting from the price movement caused by the original transaction. The RabbitHole feature helps mitigate this risk by using advanced algorithms to prevent such predatory practices, ensuring a safer trading environment on decentralized exchanges. This feature reflects 1inch's commitment to enhancing user security and maintaining integrity within the trading process on its platform.

How to Swap on 1inch Exchange

Below are the three steps to completing a swap on the 1inch Exchange:

Step 1: Connect your ETH Wallet

You will have the option to connect your wallet right from the homepage. Find the “Connect Wallet” button in the upper right corner of the website and click it. You’ll need to accept the terms and conditions, choose between the Ethereum or Binance Smart Chain networks, and choose the wallet you’re trying to connect.

Step 2: Select the Token

Once your wallet is linked, you can choose which tokens you’d like to exchange. In addition, the 1inch Exchange will display a comparison chart showing the exchange rates from various linked DEXs.

Not only is it possible to see the individual rates, but you can also compare those with the best rate available.

In some cases, you might not be able to find the asset you’d like to swap in the menu. This can occur if the asset hasn’t been whitelisted yet by 1inch. In this case, you can apply for the token to be whitelisted, or you can simply add it as a custom token by clicking the small circled plus icon in the upper right corner of the order entry box.

Step 3: Swap Tokens

The token swap has several parameters you can choose from. It will allow for a market order or a limit order, and you can choose to execute the order for the maximum return or for the lowest gas price. In either case, it will show you your exchange rate, the USD value, and the anticipated fees for the exchange.

 Choose from limit or market orders, best exchange or lowest gas, and swap your tokens transparently. Image via 1inch.exchange 

You’ll next need to unlock the token, and you can either unlock just for this exchange or choose the Infinity Unlock option. The former is more expensive in the long run, but it is also potentially more secure.

Once the tokens are unlocked, you can confirm the swap by clicking the “Swap Now” button. Next, you’ll be presented with all the swap details and asked to verify them once again. And then finally, you’ll need to approve the transaction in your wallet, and it will be sent to the blockchain.

DeFi Racer Game

The most innovative aspect of the 1inch wallet is the DeFi Racer Game, a car-racing game found inside the wallet. The main purpose of the game is to go as far as possible without hitting obstacles while collecting in-game coins. These coins will allow the user to unlock in-game features and assets such as new cars.

Users are encouraged to participate in online tournaments to vie for the grand prize: 1,500 1inch tokens. Whoopee! Tournament start days and times are posted on 1inch's social media channels together with the rules.

The game was released in December 2021 and built by Nord Beaver studio from a development grant by the 1inch development fund. This is the first foray for 1inch into GameFi and Web3.0. There is also mention of NFTs coming soon.

This is quite a brilliant idea because it uses the wallet app as a game app as play is not restricted to using the DEX. A brand-new wallet with zero transaction history can still play it. It's a great way to hook in players or even non-crypto noobs. I'm looking forward to how they will continue exploring ways to get more entrants into the 1inch world.

Depending on the game's popularity, we might see more of such features in the 1inch wallet in the near future. I can totally see other wallet developers jumping on the bandwagon for this one, and it won't be long when we have all kinds of racing or some such games appearing in wallets.

1inch Infinity Unlock

I've mentioned the Infinity Unlock feature several times, so now might be a good time to look at it in more detail. Basically, it gives the platform permission to spend a specific token forever, meaning you won't have to spend gas to unlock the token again in the future. While it is a saving on transaction fees, it could potentially be dangerous if a hacker finds a way to exploit it in the future. The basic Unlock feature is more expensive in the long-run but also more secure.

1inch Liquidity Pools

The original liquidity pools for 1inch were on the Mooniswap portal, which was based on the Uniswap model. More recently, the Mooniswap portal has been deprecated and rebranded 1inch Liquidity Protocol and moved to 1inch Exchange.

You can find the 1inch Liquidity Protocol pools by navigating to the DAO tab on the exchange website and then going to the Pools tab in the left sidebar. Those who may have had liquidity remaining on Mooniswap could remove that liquidity and move it to the 1inch Liquidity Protocol.

As you can see, there are a number of pools available with good liquidity and very generous APYs.

Not all pools are included in the 1inch farming, so if you are interested in staking your LP tokens to earn 1INCH tokens, you should choose liquidity pools such as 1INCH-ETH, 1INCH-USDC and 1INCH-DAI.

Adding Liquidity to Pools

You know all about adding liquidity if you’ve worked with any AMMs before, and the 1inch pools aren’t different. You start by connecting your wallet if it isn’t already connected. After that, you’ll navigate to the Pools section of the portal under the DAO tab. There you’ll see all of the available liquidity pools, including how much liquidity is in them and the APY they are currently yielding.

Find the pool you’re interested in providing liquidity to and click on it. Then find the “Provide Liquidity” button and click it.

When you're providing liquidity, you need to deposit an equal value of each token into the pool. 1inch makes this easy enough, and you can simply add the amount for the LP token you want to mint and then adjust it based on the amount of crypto you want to add to the pool.

You'll again use either "Unlock" or "Infinite Unlock" to allow the platform to use your coins. After unlocking the pair of tokens, you can add liquidity in the future by making a final transaction.

Virtual Rates

A feature of 1inch when it comes to liquidity is Virtual Rates. It is designed to protect against 'front-running" attacks. The term itself comes from the old days in stock exchanges where the ones posting the trades on behalf of others will put their own trades to benefit from the knowledge gained. In this case, the rate shown is a "fake" rate matching the previous swap, or it remains the same for future swaps in the same direction instead of the real rate. Therefore, any bots seeing the rates would not be able to react accordingly. After a successful swap, there is a "decay period" for the fake rate. This can be anywhere between 1 - 5 mins. The period of time is voted on by the DAO community.

Staking 1inch LP Tokens

Once you've provided liquidity to one of the pairs included in the liquidity farming portal, you will be able to stake those LP tokens and earn 1INCH tokens.

Get started by clicking the Farming link in the left sidebar of the DAO page. Now you'll see all the 1INCH farming pools that are available, and you'll be able to stake your LP tokens.

When you click the Deposit button for any of the pools, it will bring up a form to input how much you want to stake in that pool. Once you enter an amount, it will estimate your daily, monthly, and yearly 1INCH earnings.

1inch Exchange Security

As is the case for anything crypto-related, security is key and a primary concern for all users.

One way 1inch is secure is that it is a non-custodial DEX aggregator platform. That means they never have possession of your coins or the private keys. So, unlike centralized exchanges that require you to deposit your cryptocurrencies to trade, at 1inch, your coins always remain in your wallet and in your possession.

One further nod towards the security at 1inch is that the platform has never suffered from any hacks or security threats. And since you never provide them with any personal information, not even an email address, there's no need to worry about data breaches.

1inch Customer Support

While you might not expect much in the way of support from a decentralized exchange with no account registration process and no fees for trading, the 1inch team has actually made sure that customer support is available through several channels.

• Email support – [email protected]
• 1inch Exchange Help Center
• Live Chat
• 1inch Exchange support group
• Telegram group

Furthermore, the 1inch team is also active on social media channels such as Twitter and YouTube.

1inch and Skynet

Of all the partnerships that 1inch has aligned itself with, the one with SkyNet looks to be the most intriguing. Here's a quick primer on what is Skynet:

Skynet is an infrastructure project that supports a decentralized version of the Internet by hosting it. Developers use the toolkit provided to build open-sourced applications that carry censorship-resistant content for users with a universal log-in identity and the ability to own their data.

Now that we have an idea of what Skynet is let's look at how the integration with 1inch fits in.

When interacting with the 1inch dApp through a browser, the user may be susceptible to being hacked. This is because there's no way to know if the programming code has been tampered with by the browser. There is also no concept of an older version of a webpage that one can go back to, like a time machine for web pages. With the Skynet integration, 1inch users who are also Skynet members can upload the saved version of the web app to their Skynet storage, a decentralized storage area. These versions can be accessed even if the website itself goes offline or is compromised. All this is done via the SkyNet Homescreen page accessible to all SkyNet users.

The key takeaway for this collaboration is about safeguarding the user's security in ways that the user might not even be aware of. It may be a bit difficult to wrap one's head around this. However, it could be the beginning of something that we could see more of in the coming days, especially if there is a popular dApp involved.

1inch and TradFi

The 1inch Card represents an April 2024 strategic partnership between 1inch, Crypto Life, and Mastercard, aiming to bridge the gap between decentralized finance (DeFi) and traditional finance. This collaboration introduces a Web3 debit card that facilitates the instant conversion of cryptocurrencies to fiat, allowing users to make online and in-person purchases worldwide wherever Mastercard is accepted. Additionally, the card supports cash withdrawals at ATMs.

1inch’s collaboration with Mastercard and Crypto Life enhances the utility of cryptocurrencies by enabling everyday transactions through the 1inch Card. It combines the flexibility of DeFi with the widespread acceptance of traditional financial systems, maintaining users' custody of their funds until the moment of transaction. The card will be available in both physical and virtual formats, equipped with standard security features like a card number, validity date, and CVC, ensuring safe transactions.

This initiative not only extends the functionality of cryptocurrencies into daily commerce but also positions 1inch as a pioneer in integrating DeFi services with established financial networks. The card is initially set to be available to users in the UK and the EEA, reflecting a significant step towards mainstream adoption of DeFi solutions.

Conclusion

Overall it seems clear that the innovative features and tools provided by the 1inch Exchange can far outweigh any potential issues with the platform. In fact, we think the 1inch Exchange has done an excellent job in handling some of the problems that plague the emerging DeFi ecosystem.

One of their solutions is the provision of far greater liquidity than many of the existing DEXs. The lack of liquidity is a problem caused by the fragmentation of DEX platforms, but as an aggregator, 1inch more than makes up for this.

By splitting orders across multiple exchanges where necessary 1inch does away with the slippage that can lead to far higher than necessary trading costs. It's also quite nice to compare the rates and gas fees being offered across multiple exchanges. Active traders will find that this can save them quite a bit of time wasted in looking across the order books of multiple exchanges.

Features such as Fusion 2.0, the 1inch Liquidity Protocol, and the addition of limit orders bulks up the useability of the dApp for all sorts of users. Furthermore, by including bridges to other networks, 1inch is keen for itself to be integrated with as many partners as possible, thus extending its relevancy in the crypto world.

Coupled with novel ideas like the DeFi Racer and SkyNet to lure more users to the 1inch universe, we can expect more innovative initiatives from the 1inch team in the coming years. One idea could be enabling cross-chain swaps, proposed by Messari in their report on the project. This involves the combination of multi-chains and L2s with the Pathfinder algorithm. It could even lead to cross-chain staking, where users buy a token from one chain through 1inch and stake them for rewards in another. Maybe 1inch can charge a small commission for each successful first-time stake done through its network, like collecting toll fares on the open highway.

The team has put in a lot of effort to attract new users, both crypto beginners and non-crypto beginners. While there is still a bit of an entry barrier for the latter group, the website design has aimed to simplify the UI as much as possible for performing various tasks.

By putting the DeX into the 1inch wallet and a snazzy game in it, the team knows that the best way to grow is to make the pie bigger for everyone.