Today’s article will start by exploring crypto swapping. In doing so, you will learn what it is exactly and how it works. From there, we’ll also cover the ins and outs of what a crypto swap is and the difference between centralized and decentralized swaps. Lastly, we’ll show you how to get started with cryptocurrency swapping using Moralis Money.
As a little sneak peek, here's a quick demo of how easy it is to start crypto swapping with Moralis Money. In the example below, we swap DUCKIES for wrapped BTC on the Polygon network:
Crypto Swapping 101: What is Crypto Swapping?
Crypto swapping refers to the process of instantly exchanging one cryptocurrency for another without the need for a crypto-to-fiat exchange.
It may sound simple enough; however, things can become a bit messy when you have thousands and thousands of coins and tokens. The crypto market is rapidly expanding, and new tokens are minted daily, and each new crypto may present a potential investment venture. To some, it may very well shape their financial futures, so knowing what crypto swapping is and how it works can make a huge difference.
Furthermore, tokens effectively act as the keys to their native blockchain ecosystem, providing holders with various benefits, such as the right to participate in the governance of a protocol. Accordingly, crypto swapping makes it easier for users to explore these opportunities and become part of multiple projects they wish to support.
However, new traders often have no clue how to proceed when faced with an overwhelming number of coins. They might have invested in a few tokens from one blockchain network but now see opportunities to profit from another.
When faced with this scenario, people often follow the conventional method of conversion. In doing so, they would convert their tokens to fiat currency and then use it to buy the token they want. While this is a valid method, it takes an extra step and may result in you paying transaction fees multiple times.
Crypto swapping removes these issues and provides a more seamless process, allowing you to instantly acquire coins you’re after. So, saving time and paying less transaction fees are two obvious benefits of crypto swapping.
Is Swapping Cryptocurrency Profitable?
Is swapping cryptocurrency profitable? Well, yes and no; it depends on your swaps!
The method of acquiring a new asset doesn’t automatically make it profitable, as it depends on how the price develops. For instance, if your investment drops by 50%, it doesn’t matter how you acquired the token.
However, depending on the cryptocurrency you’re interested in, you can save a lot of money on transaction fees by swapping, especially on a network like Ethereum, where fees can be astronomical. In this sense, swapping cryptocurrency can be more profitable than trading it.
But ultimately, what determines the profitability of either swapping or trading cryptocurrency depends on the quality of your investment.
Swapping vs Trading - Is Crypto Swapping Better Than Trading?
The words ”swap” and ”trade” can often be used synonymously, but they actually have different meanings when it comes to crypto trading. Yet, the mechanics of swapping and trading crypto are precisely the same, with the goal of exchanging one asset for another. However, the difference in outcome can sometimes be significant.
When trading crypto, you execute trades based on an order book. Furthermore, you can only trade based on the pairs of that particular exchange. As such, trading generally requires exchanging one crypto for fiat currency and then purchasing a new coin with your obtained currency. If this occurs on a cryptocurrency exchange, you may be hit with whatever fee or commission they charge on all sides of the transaction.
Swapping, in comparison, allows you to exchange one crypto for another effortlessly. This transaction happens instantly, and you don’t need to initially exchange crypto for fiat. This is a more flexible approach, as a crypto swap can allow you to exchange one asset for another, even if the pair is not live on the spot market.
Nevertheless, with that said, both cryptocurrency swapping and trading have their own unique set of benefits and disadvantages. As such, it’s impossible to say that crypto swapping is better than trading. It depends on your needs and preferences as an investor.
What is a Crypto Swap?
Now that you have familiarized yourself with the process of swapping cryptocurrency and what it entails, let’s explore the intricacies of crypto swaps. So, what is a crypto swap?
A crypto swap is basically an exchange platform facilitating the swapping of cryptocurrencies. They usually feature a straightforward user interface (UI) where you can select two cryptocurrencies and swap one for the other. For instance, this is an example of what it can look like:
There are various types of crypto swaps, and they usually fall into two major categories:
- Decentralized Exchanges: Decentralized exchanges (DEXs) involve no central governing authority. Instead, they are regulated by self-executing smart contracts. Furthermore, DEXs are peer-to-peer, allowing users to directly swap cryptocurrencies whiteout an intermediary.
- Centralized Exchanges: Centralized exchanges (CEXs), on the other hand, are platforms operated by centralized organizations. Many of these platforms offer crypto-swapping features; however, they differentiate their offerings via a variety of trading pairs.
If you’d like to learn more about crypto swaps, check out our guide on the best coin swap sites for swapping cryptocurrency!
Crypto Swapping on CEXs vs DEXs
There are advantages to crypto swapping on both CEXs and DEXs, and a key decider is usually token availability. As we previously mentioned, there are thousands of cryptocurrencies, and they aren’t always available on CEXs; however, you can often easily find them on a DEX.
CEXs are usually where beginners first interact with cryptocurrencies. As a result of this, they often feature intuitive UIs. As such, swapping cryptocurrency on a CEX is easy and straightforward.
However, as crypto moves towards mainstream adoption, DEXs are focusing more on their UIs, making the user experience more suitable for the masses. As such, it’s becoming easier and easier to interact with blockchain ecosystems in a decentralized manner.
Furthermore, through a DEX, you remain in complete control over your assets. This means there’s no need to trust a third party or surrender your private keys in any way. On a CEX, you usually need to entrust your private keys to the central organization, which, in some instances, can be a security risk.
How to Get Started Swapping Crypto the Easy Way
Now that you have familiarized yourself with the intricacies of swapping crypto and crypto swaps, it’s time to look at a practical example. So, in this section, we’ll demonstrate the easiest way to start swapping crypto.
Moralis Money is the premier option among the best blockchain analytics tools. It leverages on-chain data in real-time, providing you with true market alpha. As such, when working with Moralis Money, finding new crypto projects that are about to break out has never been easier.
In addition to being the ultimate blockchain analytics tool, it is also equipped with an easy-to-use swap feature. So, how does it work?
Let’s show you how to start swapping crypto in three simple steps:
- Step 1: Find a Token - Before you even think about swapping, you first need to find a cryptocurrency. For this, you can leverage Moralis Money, as the platform is the ultimate tool for finding the most undervalued crypto. However, we’ll cover this further in the next section.
- Step 2: Go to its Token Page - Once you have found a token you’re interested in, head to its token page. To do so, use the Moralis Money search feature at the top of the UI. In this case, we’ll use wrapped BTC on the Polygon blockchain as an example:
- Step 3: Swap - Next, use the crypto-swapping feature to the right to swap your existing tokens for wrapped BTC:
That’s it; this is how easy it is to swap crypto using Moralis Money! However, the feature for swapping crypto is just the cherry on top, and there’s a lot more to Moralis Money. So, let’s explore the benefits of using Moralis Money for crypto swapping!
Benefits of Using Moralis Money for Cryptocurrency Swapping
Moralis Money’s crypto-swapping feature is just the icing on the cake, and it’s the surrounding tools making the platform stand out. In fact, Moralis Money is the ultimate crypto breakout scanner, and with the platform, it has never been easier to find tokens before they pump!
Consequently, not only can you swap tokens using Moralis Money, but you can also find new promising altcoin opportunities, making it a one-stop shop for all traders. So, let’s take a look at five benefits of using Moralis Money for crypto swapping:
- 1inch Aggregator: Moralis Money’s swap feature leverages the power of the 1inch aggregator to always give you the best prices.
- Token Explorer: With Moralis Money’s Token Explorer, you can pick and choose between 15+ filters to create unique search strategies. In doing so, you can target those unique tokens you're looking for and immediately swap them after.
- Token Alerts: Token Alerts lets you set up email notifications for individual tokens and the entire market based on unique filters. This means you can monitor the market and your assets even when you aren’t actively trading. For instance, learn how to effortlessly set up crypto price alerts here.
- Token Shield: Use the Token Shield feature to protect yourself from rug pulls and exit scams. Look for the shield symbols attached to each coin for a quick evaluation, or go to their token pages for more detailed security information:
- Token Pages: Each cryptocurrency has its own dedicated token page on Moralis Money. By visiting these pages, you get a bunch of alpha metrics, price charts, security information, and, of course, the swap feature so you can seamlessly acquire each token:
With the features above, you can easily find and acquire tokens in a heartbeat, making Moralis Money the ultimate crypto swapping tool for crypto traders!
Summary: Cryptocurrency Swapping Explained - How Does a Crypto Swap Work?
In today’s article, we explored the ins and outs of crypto swapping. In doing so, you learned that it’s the process of instantly swapping one cryptocurrency for another without the need for a centralized exchange. Two benefits of swapping crypto are that you can save time and money since you have to pay for fewer transactions in total.
We also dove into crypto swaps, discovering that they are platforms allowing you to swap cryptocurrencies. What’s more, you also learned that there are two main types of swaps: decentralized and centralized swaps.
From there, we showed you how to start swapping cryptocurrency using Moralis Money - the #1 crypto trading and swapping tool. In doing so, we showed you the three steps for swapping cryptocurrency:
- Step 1: Find a Token
- Step 2: Go to its Token Page
- Step 3: Swap
If you found this guide informative and want to start using Moralis Money to swap cryptocurrency, consider also subscribing to the Moralis Money Pro plan. With the Moralis Money Pro plan, you get to maximize the platform's value. Among other things, it gives you access to the Token Alerts feature, more narrow timeframes for all search metrics, premium education, etc.:
You can try the Moralis Money Pro plan by going to our pricing page and signing up for the seven-day trial:
Also, you can experience the power of Moralis Money right here using the widget below. Apply a premade filter or create your own strategies by combining the filters of your choice: