BitcoinUSD

  • Market Cap: $1,305,631,657,991.03
  • 24h Vol: $86,903,074,093.43
  • BTC Dominance: 42.57%
1inch

What is 1Inch? How To Buy, Expectations And Predictions. Everything You Need To Know About 1INCH

When you buy crypto coins, do you use a centralized exchange? Too bad, some decentralized exchanges have a lot of advantages to offer. For example, 1inch is also a decentralized exchange. Here you can compare the prices of different crypto coins between different platforms. You pay a different price per platform for coins and tokens. In this article we explain more about what 1 inch is and how you could use it yourself. After all, you also want to buy crypto coins for the best price, right?

What is 1inch?

1inch is basically a decentralized exchange aggregator. This means that the platform allows you to compare the cryptos on different platforms in terms of price. This is what we call a DEX aggregator (for Decentralized Exchange). This is actually also the reason why many people use this platform.

1inch was created by two Russians, Sergej Kunz and Anton Bukov, in 2019 during the ETHNewYork hackathon. They later raised more than $15 million from Binance Labs, Galaxy Digital and Pantera Capital. By the month of January 2021, the trading volume of the platform exceeded $155 million per day. That’s how successful 1inch is.

When you use the platform, it is possible to see where you can buy your crypto coins and tokens for the best price. Nobody wants to pay too much money for their tokens. You do not pay any costs to use 1inch, but you do pay the normal transaction costs for the exchange that you will eventually use.

1inch is decentralized, meaning it runs on the blockchain. So there is no organization that centrally manages the platform. However, you cannot buy 1 inch crypto coins yourself; you end up buying them from the exchange you found through 1inch.

Why are decentralized exchanges becoming more popular?

What you need to remember is that decentralized exchanges are cryptocurrency exchanges that do not require a third party to operate them. That is why it is also called decentralized. There is no single person, group or entity that controls the transactions or manages the funds, as is the case with centralized platforms.

Usually it is centralized platforms like Binance where most crypto traders conduct their trades. There are therefore far fewer decentralized exchanges than centralized exchanges.

However, decentralized platforms have been gaining popularity in recent years. For example, we can use Uniswap , which is getting more and more users. But why is that so? There are also disadvantages to decentralized platforms.

The big advantage of DEX is that you only have to connect your wallet (e.g. Metamask) and you do not have to give your personal details. For example, no KYC needs to be sent, for the simple reason that there is no central company operating an exchange platform.

So for people who seek anonymity in their use of cryptocurrencies, this is a huge advantage. They can buy their crypto coins without too much effort, in complete anonymity. See below what the 1 inch protocol looks like.

1inch protocol

Why is 1inch different from other DEXs?

There are many decentralized exchanges, such as Uniswap, Oasis or Kyber Network. Each of the platforms works in its own way, although the principle remains the same; exchange cryptos. There is also a difference between these platforms in the price you pay to buy a token or coin. This creates possibilities.

For example, the price of ETH or any other ERC-20 token could be different on Oasis than on Uniswap. In addition, the fees on each platform are different and are higher or lower. And, this is where 1inch comes into its own!

As mentioned in the introduction, it is an aggregator that displays the best prices of the cryptocurrencies available on decentralized exchanges. So you can see the price differences and choose the cheapest price. You can think of it as a comparison website.

With the last update of the platform (V2), 1inch was able to list up to 21 decentralized exchange platforms. This means that users have access to all prices on one platform, in order to ultimately purchase their cryptocurrency or token of choice for the cheapest price.

What is the 1INCH Token?

On Christmas Day 2020, the 1inch platform launched its own token: the 1INCH token.

This token is a governance token that you can use on the platform. You can also vote on how the platform is managed. Thus, the governance of the platform is decentralized and highly democratic. In addition, it is also a utility token, which means you can use it on the 1inch platform.

There have been some very interesting crypto airdrops in the loading. To win 1inch tokens, you had to provide liquidity before December 24, 2020. If you missed the event, you may want to register for crypto airdrops platforms so you don’t miss out in the future. Sometimes there are real opportunities to be had. That is still possible on the 1 inch platform.

How can I earn 1inch tokens?

To earn 1inch tokens (which continue to increase in value as the platform grows), you must first join the platform. The main way to earn 1inch tokens is to provide liquidity to the platform. You can provide liquidity to various pools on the platform. Think of Aave , Compound , Uniswap, Balancer , Mooniswap, etc .

How do I buy the 1inch cryptocurrency (1INCH)?

Due to its great popularity, it is possible to buy 1INCH tokens on many different platforms. Think of exchanges such as Binance, ByBit, Bittrex and Gate.io . Make sure you buy 1INCH on a reliable platform. It is also possible to buy 1INCH on a decentralized exchange (DEX), although this is a lot more difficult than on a normal crypto exchange . That’s why we recommend that you do it on Bitvavo. You can do that within a few clicks.

How do you store 1INCH tokens?

Since 1INCH is an ERC-20 token, the safest way to store your 1INCH tokens is a hardware wallet (also known as a cold wallet). These are electronic wallets in the form of a USB stick. The best-known and most popular cold wallets are those from Ledger. We definitely recommend that you store your tokens in a hardware wallet, because this is a lot safer than in a hot wallet.

However, it is possible to store your tokens in a hot wallet . Since the 1INCH tokens are ERC-20 tokens, these tokens are supported by almost every online wallet. You can of course also choose to store it in the wallet of the crypto exchange, or to choose MetaMask.

How do you use the 1 inch platform?

To use the 1inch platform, you will first have to go to the website. Next, you must have an Ethereum wallet in your browser. If you don’t have one yet, it’s best to create one first. Of course you can also choose a different wallet. This wallet must contain coins or tokens in order to carry out transactions.

Once you have installed your wallet and added funds, you can click on “Content Wallet” on the website. You will see that you will be offered different types of wallets to connect. Once your wallet is connected, you can get started and exchange the tokens.

What you should actually look at is the price, but especially the associated “gas” costs. These are the network costs that you have to pay to the Ethereum miners that will process the transactions.

We remind you that the rates are sometimes very high (when the network is congested and many people use it). Lately that has often been the case, and you sometimes pay transaction costs of several tens to hundreds of dollars.

When you have selected the correct tokens and the charges are correct, all you need to do is click on “Swap Token” and validate. You then exchanged tokens for other tokens. So it is anything but complicated to use the 1 inch platform. This also applies to most other decentralized platforms.

What is the cost for 1inch?

1inch exchange does not charge any withdrawal fees. The only fees are network fees charged by the exchange where the user actually executes a transaction (e.g. Uniswap, Kyber Network, etc.), the amount of which depends on the gas price at the time the transaction is executed.

Since these fees are charged by the other exchange, 1inch does not benefit from these fees in any way. However, users can save on their gas costs by using the Chi GasToken launched by 1inch.

What is the Chi Gas Token?

The Chi GasToken, known as “Chi”, was launched by 1inch in June 2020. What is called “gas” is comparable to the fees that banks charge for money transfers, for example.

The only difference with DEX is that you cannot predict the amount of the fee. It fluctuates depending on the users. The more transactions you have to process, the more fees you have to pay. This can have negative consequences for users, because they sometimes have to pay sky-high costs.

To reduce the gas, 1inch created the ChiGasToken. Chi is indexed to the Ethereum network gas price. So if the gas price is low, so will the Chi, and vice versa.

Advantages of 1inch

  • The interface is very nice and intuitive for a clear use.
  • There have been no issues with hacking or hacks.
  • The 1inch exchange does not charge any withdrawal fees, with the exception of network fees.
  • Liquidity is a major issue on decentralized exchanges. Not only is the liquidity on DEXs generally low, but this liquidity is further fragmented by the existence of several DEXs. They share an already low liquidity. Ultimately, 1inch solves this problem by dividing the orders between the DEX.
  • Chi GasTokens saves costs for everyday users.
  • Their new automated market maker (AMM) used in Mooniswap takes advantage of user slippage and protects traders from certain attacks.

The Disadvantages of 1inch

  • Even with the manuals, it must be said that it can be complicated to fully understand and use all the features of 1inch.
  • New investors and crypto beginners are not encouraged to trade on this platform as it does not accept any deposit methods other than cryptos. This means that one must already own cryptos beforehand.

1inch (1INCH) Chart

Conclusion

Does the future of 1inch depend on the future of decentralized finance (DeFi)?

In fact, if a DEX like Uniswap, for example, managed to be bigger than all the others, we wouldn’t see the point of, say, 1inch or any other aggregator. 1inch also indirectly solves the liquidity problem, which is a major problem for DEXs. This is also the reason why the Wrapped Bitcoin (WBTC) was created.

Yet it seems that 1inch is mainly aimed at the more experienced crypto traders. The platform is difficult to use for traders who are just getting started. This is something you see with multiple DEXs. However, it is not strange to still think that 1inch will eventually be one of the largest crypto platforms. The advantages do not outweigh the disadvantages. And that’s what it’s all about in the end.

It is also interesting to note that 1inch has never had to deal with hackers or security breaches. That is already a big point and a big advantage. Only about the future of 1inch, we can say that it depends on the future of decentralized exchanges. For now, DEXs remain more expensive (in terms of fees), slower and do not have a large volume and thus low liquidity compared to CEXs.

We see centralized platforms like Binance literally exploding in terms of volume and number of users. However, if these platforms decline in popularity, we can largely assume that DEX aggregators like 1inch will take over. Until then, we’ll have to wait for version 3, so we can see if 1inch will be even better and cheaper.

 

Leave a Comment

Your email address will not be published.