Swap — what does it mean?
In crypto world, the term swapping is very famous, but it can be misunderstood completely.
Especially when the person who talks about it, can not find a difference between swapping and trading.
Do you know the differences?
Agenda:
- intro,
- definition,
- trading vs swapping,
- conclusion.
Definition
Swapping is literally an exchange of one token/coin for another token/coin. Sounds pretty simple, but remember, in crypto there are thousands of different assets.
It is not a big mystery that crypto assets are not only some kind of constant value defined in FIAT currencies. It can be something more…
Considering a great crypto exchange as an example, they can be emitting own token. This token is an exposure to the future grows or dumps of this company.
Why to not invest on tokens which not only grow in usd, but also give extra value of some community/company grows and falls.
More crypto investors think the same, so they have two possibilities:
- change some cryptocurrency for FIAT and then buy desired coin.
- swap directly picked tokens into ones they want.
Trading vs swapping
Swapping requires no special knowledge and what is more, avoids paying double fees.
Trading coins for FIATs and then again for coins affects paying fees two times, while by swapping it is only once.
Swapping is strictly connected with the available pairs of crypto assets. There are cases when no platform offers swapping the specific coin for other defined asset.
Conclusion
Swapping is a very beneficial and efficient functionality. Making directly exchanges of tokens without spending too much on fees is crucial on defining the advantages of it.
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