1inch Exchange is a decentralized exchange (DEX) aggregator. It’s designed to roll liquidity and pricing from all major DEXes into one platform, making it easy to get the best price for the desired trade.
Trades via 1inch can be split across exchanges, to minimize slippage and provide the best pricing possible.
1inch is also non-custodial, with all trades being performed within a single transaction from a user’s Ethereum-based wallet.
The idea for 1inch was sprouted just weeks before the ETHNewYork convention, while the two co-founders were playing around with arbitrage bots.
The project was then fleshed out during the hackathon at the event, creating the first iteration of the exchange: An MVP which aggregated Kyber, Bancor, and Uniswap liquidity.
There is no documented funding for 1inch itself, although an on-chain aggregator by the same team – 1Split – obtained a small amount of funding via Gitcoin grants. 1Split raised 13,513 DAI for its development.
Why 1inch Exchange?
Reduces liquidity issues
Liquidity is a significant issue on decentralized exchanges. Not only is liquidity low on DEXes in general, but this liquidity is further fragmented across several different DEXes, worsening the problem. This makes large-volume trades susceptible to significant slippage, resulting in bad pricing for trade execution.
1inch solves this by splitting orders across exchanges, yet keeping the trade within one transaction. This reduces the issues seen with relying on a single exchange for liquidity.
Aggregates price and quote data
1inch shows exactly what each exchange offers in an easy-to-view way. The price and liquidity available from each platform are clearly displayed to the user, along with gas fees.
This saves the user both time and clicks, avoiding the need to open multiple exchanges and assess the order books.
Every transaction on the Ethereum network requires a processing fee, dubbed “gas”. These fees can fluctuate with network usage, often getting expensive when the network is running close to maximum capacity.
1inch saves on transaction costs by utilizing GasToken, a token which stabilizes the price of gas.
Smart Contract Covers
Using 1inch, users can purchase smart contract covers directly on the exchange through Nexus Mutual.
You can now buy easily a cover for https://t.co/fLXva1SFRG on @NexusMutual! We have a huge stake already on our 1inch smart contract! Keep it safe and buy a cover! #DeFi pic.twitter.com/WQst7FBaG2
— 1inch.exchange (@1inchExchange) March 4, 2020
How Does it Work?
To get started, visit https://1inch.exchange/
Here, a user can select which assets they would like to exchange, and the best available rates. They can also toggle on/off specific exchanges, depending on their preferences.
Scrolling down, a user can also view the exchange rate going at each individual platform, as well as how much it varies from the best price. Some centralized exchanges are also shown, for comparison.
To proceed with the trade, click “SWAP NOW”.
A user will then be asked to confirm their trade. Ensure that the details are correct, and then select “VERIFY”.
The user will then approve the transaction within their wallet, and the trade will be processed on the blockchain.
And that’s it! Low-Slippage, best-rate currency exchange has been processed, using the best rates available on the market using 1inch.
How to get involved?
Long-form blog posts can also be found on their blog on Medium.