Fusion Swap is a new feature introduced by 1inch, a popular decentralized exchange (DEX) platform, that improves the way users trade cryptocurrencies. It offers a more competitive trading experience, removes the need for native tokens to pay for gas fees, and protects users from front-running attacks (MEV).
In Fusion Swap, when you want to trade one cryptocurrency for another, you set up an order as a “maker.” After you’ve placed your order, other participants called “resolvers” compete to fulfill it while also covering the gas fees.
Resolvers are approved addresses that have staked 1INCH tokens and can complete orders on the 1inch Network. They compete in a “dutch auction” style, where the trading rate starts high and decreases until one of the following happens:
- A resolver fills the order.
- The price falls below your acceptable price range (slippage tolerance).
- The order expires.
If the price goes below your acceptable range or the order expires, the trade won’t go through, and you’ll need to resubmit it. One of the best parts of Fusion Swap is that you don’t need any native tokens (like ETH, BNB, or MATIC) in your wallet to cover fees, even for failed or expired orders.
Fusion Swap offers several benefits for both regular users and resolvers:
Users:
- Trade without needing native tokens for gas fees (within a specific price and time range).
- Protection from MEV attacks.
- No price impact on trades.
- No fees for failed transactions.
- Fast trade execution.
Resolvers:
- Earn rewards from staking 1INCH tokens.
- Collect fees for completing orders.
- Participate in the 1inch Network Gas refund program.
- Gain 1inch DAO governance voting power.
How to swap:
With Fusion mode, there are several options :
Auto (recommended): Execute a trade at the best rate possible automatically, base on current market conditions.
Fast: Execute the fastest trade, but at a lower rate.
Fair: Execute a swap with a slower speed (6 min), but at a potentially better rate.
Custom: This feature is under development. Stay tuned for future updates!
By default “Auto” is the recommended setting, as it offers the smoothest user experience.
How to swap:
First, connect your wallet to the 1inch dApp.
Then, enter the amounts you would like to swap, and click either “Permit and swap” or “Approve tokens” depending on the asset you are selling. You will need to sign this approval transaction in your wallet.
Once the approval or permit is successful, click swap. Then confirm the details on the following screen, and click “Confirm swap”.
Once the transaction is sent, it will show as “pending” in the upper right corner of the page. During this time (dutch auction), the rate will slowly decrease until a resolver takes the order.
What happens if my swap expires?
If the swap expires, it will need to be resubmitted. Unlike a legacy swap, won’t cost any gas fees! You can check the status by clicking on your “connected address” in the upper right corner of the page.