What Is A Token Swap & How To Swap Tokens On Okto In 9 Easy Steps
Token Swap is a simple process of exchanging one crypto token for another crypto token. Continue reading this article to learn how to swap tokens on Okto in 9 easy steps.
5 MAY 2023, 4 min read
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As the blockchain ecosystem evolves, continuous innovation has led to numerous developments in the space that has simplified trading crypto. Token swapping is one such innovation. Traditionally, crypto exchanges have been used as the primary method to exchange crypto tokens but with the emergence of Decentralised Finance (DeFi), token swapping or exchanging one token for another is now available as a simplified option.

In this article

  • What is a Token Swap?
  • Benefits of Token Swaps
  • How to Swap Tokens on Okto?
  • What is Slippage?
  • Risk Involved in Token Swap
  • Frequently Asked Questions

What is a Token Swap?

Token swapping is a process of exchanging one crypto token for another. This process can occur on decentralized exchanges (DEXs), which are platforms that allow users to trade crypto without a centralized intermediary.

The process of token swapping involves exchanging tokens based on their market value, and it typically involves two types of tokens: the token being sold (the "sell" token) and the token being bought (the "buy" token). For example, if a user wants to swap their Ethereum (ETH) token for Bitcoin (BTC), they would need to find a trading pair on a DEX that allows them to sell ETH token and buy BTC token.

Okto is a multichain platform that has integrated tokens available across different chains and protocols. Users can choose from 1,000+ tokens from chains such as BNB, Polygon, Avalanche, and Fantom. It provides a one-stop solution for users to access tokens of their choice, swap, and trade easily, and generate passive income. Users do not need to switch between multiple wallets to access different tokens as they can swap tokens directly on the Okto app.

The exchange rate between the two tokens is determined by the market demand and supply, and the exchange may also involve a small transaction fee. The exchange may also involve slippage, which is the difference between the expected price of the tokens and the actual price at the time of the exchange.

Overall, token swapping on Okto provides a convenient way for users to exchange one crypto token for another without the need for a centralized exchange or intermediary.

Also Read: Centralised Exchange V/S Decentralised Exchange

Benefits of Token Swaps

Token swapping on DEXs offers several benefits to traders as compared to exchanging tokens on centralised exchanges:

Simplified Process

There are multiple steps involved in crypto exchanges when it comes to exchanging tokens which could deter investors from exploring and investing in the crypto market, limiting investor activity. But with a simplified user experience on token swapping platforms such as Okto, it becomes convenient for users to exchange tokens and trade, taking advantage of the opportunities available in the market. Just within a few clicks, investors can swap tokens and execute their trades.

No hefty Fees

With crypto exchanges, you are required to take multiple steps when exchanging one token for another. Each transaction could incur separate fees, making transactions expensive. Token swap, on the other hand, is a single transaction, hence involving minimum fees on your trade.

Instantaneous Exchange

Due to the volatile nature of crypto markets, the multistep process involved in traditional exchanges could be time-consuming which could directly impact your profitability as the exact prices of the tokens at the time the exchange is executed could differ. However, token swapping on DEXs is almost instantaneous, allowing traders to have more control over timing for optimized profitability.

How to Swap Tokens on Okto?

Follow the steps below to swap tokens on Okto:

  • Log into your Okto account.
  • Go to the “Trade” tab.
  • Choose a token
  • Choose 'Buy/Sell' depending if you wish to buy or sell the selected token in exchange for another token
  • Choose the 'Chain' on which you wish to swap the token, currently, Okto supports the following chains: BSC, Polygon, Fantom, and Avalanche
  • Choose the token to be swapped
  • Enter token quantity
  • Swipe to Confirm
  • Your swap order will be placed, you can check the transaction status in the “Activity bar”.

Here is a video tutorial for you on a swap transaction:

What is Slippage?

Slippage is a common occurrence in trading that refers to the difference between the expected price of an order and the actual price at which the order is executed. This can occur due to various factors such as market conditions, liquidity, and order size. Typically, slippage tends to be more prevalent in larger orders and during periods of high market volatility as prices could fluctuate rapidly.

To minimize the impact of slippage on your trade, it is important to carefully consider your trading options and be aware of the current market conditions before executing your orders. You may also consider using limit orders or other advanced order types that can help you better control the execution price of your trades.

Risks Involved in Token Swap

Swapping can be a useful tool for crypto traders who wish to diversify their holdings, take advantage of market opportunities, or simply exchange one asset for another. However, it is important to note that swapping on DEXs can be subject to liquidity constraints, price slippage, and other risks associated with decentralized trading. To minimize these risks, it is important to research the DEX platform and the associated tokens, as well as to carefully consider the transaction fees, liquidity, and other factors that may impact the outcome of the swap. However, for swap, OKTO aggregates liquidity across multiple DEX and aggregators, which helps to obtain the best buying price for the users and also ensure less transaction failures due to high slippages.

Also Read: How To Pay Gas Fees On Okto Using Stablecoins

Frequently Asked Questions:

What fees are involved in swapping tokens?

You will be charged a gas fee for your swap transaction on Okto.

Which cryptos can I swap?

You can choose from 1,000+ crypto across different chains and protocols on Okto to swap.

Where can I see the conversion rate for swapping tokens?

Follow the steps below:

  • Go to the 'Trade' tab
  • Select any token
  • Choose another token to be swapped
  • Click on next and you can see the conversion amount

What should I do if my swap transaction is stuck?

If you notice that your swap transaction is in progress, it is best to let it proceed without any interference. In most cases, the network will eventually become less congested, and miners will be able to pick up your transaction. While there is no specific timeframe for when this will happen, it is generally a good idea to be patient and avoid cancelling the transaction.To perform any swap, OKTO aggregates liquidity across multiple DEX and aggregators, which helps to obtain the best buying price for the users and also ensure less transaction failures due to high slippages.

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