1Inch Exchange: The Complete Guide

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Decentralized finance (DeFi) has revolutionized how users interact with digital assets, and at the heart of this transformation lies 1Inch Exchange — a powerful decentralized exchange (DEX) aggregator that optimizes cryptocurrency swaps across multiple platforms. Since its inception in 2019, 1Inch has become a go-to solution for traders seeking better prices, lower fees, and improved liquidity. This comprehensive guide explores how 1Inch works, its core features, tokenomics, and practical steps to start using the platform effectively.

What Is 1Inch Exchange?

Founded by Sergej Kunz and Anton Bukov in 2019, 1Inch Exchange is a decentralized exchange aggregator that enhances trading efficiency by sourcing liquidity from numerous DEXs. Unlike traditional exchanges, which operate on a single order book, 1Inch scans over 33+ liquidity sources, including Uniswap, SushiSwap, Curve, and Balancer, to find the best possible rates for users.

A decentralized exchange (DEX) allows peer-to-peer cryptocurrency trading without intermediaries. However, prices and fees vary significantly across different DEXs. 1Inch solves this fragmentation problem by combining split routes, minimizing slippage, and reducing gas costs — delivering optimal trade outcomes in one seamless interface.

👉 Discover how decentralized trading can work smarter for you.

How Does 1Inch Work?

At the core of 1Inch’s functionality is its proprietary Fusion algorithm, an advanced routing mechanism that analyzes multiple swap paths across various protocols. When you initiate a trade — say, swapping USDT for WBTC — the platform evaluates:

The algorithm may execute your trade through a direct route or split it across several exchanges to maximize value. For instance, part of your USDT might be swapped on Uniswap and the rest on SushiSwap — all within a single transaction. This process ensures users receive the best net effective price while conserving capital.

Additionally, 1Inch offers Chi Gas Token integration (on Ethereum), allowing users to reduce gas expenses during periods of network congestion by leveraging gas optimization strategies.

1Inch Liquidity Protocol (Formerly Mooniswap)

In August 2020, 1Inch launched Mooniswap, its own Automated Market Maker (AMM) protocol designed to minimize impermanent loss — a common issue faced by liquidity providers on platforms like Uniswap. Mooniswap introduced a unique mechanism where price updates are delayed slightly, creating a buffer against arbitrage bots that typically exploit price discrepancies.

This delay rewards long-term liquidity providers instead of high-frequency traders, making it more profitable and fair for average users. Following the launch of the 1Inch token, Mooniswap was rebranded as the 1Inch Liquidity Protocol, reinforcing the platform’s commitment to innovation in DeFi liquidity solutions.

Today, users can provide liquidity to pools within the 1Inch ecosystem and earn trading fees and potential incentives in return.

How to Use 1Inch Exchange: Step-by-Step Guide

Using 1Inch is straightforward and accessible to both beginners and experienced traders. Here's how to get started:

Step 1: Access the Platform

Visit the official 1Inch Exchange website using a secure browser. Always verify the URL to avoid phishing sites.

Step 2: Connect Your Wallet

Click on “Connect Wallet” at the top right corner. Supported wallets include MetaMask, Trust Wallet, WalletConnect, and others. Choose your preferred option and confirm the connection in your wallet app.

🔐 Note: 1Inch is non-custodial — you retain full control of your funds at all times.

Step 3: Select Tokens to Swap

Enter the token you want to trade (e.g., USDT) in the “From” field and select the desired output token (e.g., DAI). The platform automatically displays estimated returns after fees and slippage.

Ensure you have enough ETH (or native chain gas token) to cover transaction fees.

Step 4: Approve Token Spending

Before trading, you must grant 1Inch permission to access your tokens. You can choose between:

While infinite approval saves gas on future trades, consider revoking permissions afterward via tools like Etherscan Token Approvals.

Step 5: Execute the Swap

Review the details carefully — including price impact and minimum received — then click “Swap Now.” Confirm the transaction in your wallet, and once mined, your new tokens will appear in your wallet.

👉 Start optimizing your crypto trades with smart routing today.

Understanding the 1Inch Token

Launched on Christmas Day 2020, the 1Inch token (symbol: 1INCH) serves as the native governance token of the ecosystem. With a total supply capped at 1.5 billion tokens, distribution occurs over four years through community incentives, team allocations, investors, and ecosystem development.

Key features of the 1INCH token include:

The initial airdrop rewarded early users of the platform, generating significant buzz — especially when early recipients saw substantial gains as the token surged past $5 in early 2021. A second airdrop in February 2021 expanded eligibility to regular Uniswap users, further broadening its community reach.

You can purchase 1INCH tokens on major exchanges such as Binance, Huobi Global, and directly via the 1Inch DEX aggregator.

Frequently Asked Questions (FAQ)

Q: Is 1Inch safe to use?
A: Yes. As a non-custodial platform, 1Inch does not hold user funds. All transactions occur directly through your connected wallet. However, always verify URLs and avoid granting unnecessary permissions.

Q: Can I use 1Inch on mobile?
A: Absolutely. You can access 1Inch via mobile browsers using compatible wallets like MetaMask Mobile or Trust Wallet.

Q: Does 1Inch support multiple blockchains?
A: Yes. Besides Ethereum, 1Inch supports BNB Chain, Polygon, Optimism, Arbitrum, Gnosis Chain, and others — enabling cross-chain swaps with minimal friction.

Q: How does 1Inch differ from Uniswap?
A: While Uniswap is a standalone DEX, 1Inch is an aggregator that sources liquidity from Uniswap and many other exchanges to find better rates and reduce slippage.

Q: Are there gas fee savings when using 1Inch?
A: Often yes. By optimizing routes and integrating gas-efficient tools like Chi Token (on Ethereum), 1Inch helps reduce overall transaction costs.

Q: Can I provide liquidity on 1Inch?
A: Yes. Through the 1Inch Liquidity Protocol (formerly Mooniswap), users can contribute assets to pools and earn trading fees.

The Future of 1Inch in DeFi

Since its launch, 1Inch has demonstrated resilience and innovation amidst growing competition in the DeFi space. Its focus on user-centric design, advanced routing algorithms, and continuous expansion into Layer 2 solutions positions it as a key player in the next phase of decentralized trading.

As blockchain ecosystems evolve and multi-chain interoperability becomes standard, platforms like 1Inch will play an increasingly vital role in connecting liquidity across networks efficiently and securely.

With strong community engagement, ongoing protocol improvements, and strategic integrations, 1Inch Exchange is well-positioned to remain a leader in decentralized finance innovation.

👉 See how next-generation trading tools are shaping DeFi’s future.

Core Keywords:

By combining intelligent routing, robust security practices, and community-driven governance, 1Inch empowers traders to make smarter decisions — all without sacrificing control over their assets. Whether you're new to DeFi or a seasoned trader, integrating 1Inch into your toolkit can significantly enhance your crypto trading experience.