A swap is a method used to execute crypto-to-crypto transactions without the need to use fiat currencies or major crypto assets like Bitcoin, Ether, or USDT. In the realm of decentralized finance, you no longer need to bother with selling your token before buying another one; you can directly swap the asset you possess for the desired token. This innovative process reduces transaction time and is generally more cost-effective.
How to execute your first swap in Dopamine App?
First thing first, when you launch Dopamine for the first time, you should secure your account by setting up a password and saving your seed phrase. To do that, refer to our article on How to secure your Dopamine account. Then, before doing a swap, you need to either connect one of your wallets to Dopamine or send funds to your Dopamine wallet.
In Dopamine, the swaps are based on the ParaSwap protocol. ParaSwap is a Decentralized Exchange (DEX) aggregator; it brings together multiple DEX and DeFi services to provide you with the best prices in the market. ParaSwap allows you to beat the market prices with each swap through its Best Execution Engine. The Best Execution Engine study all the aggregate markets and then choose 1 to 4 routes to execute your swap at the best price.
As of October 2021, Dopamine offers 3 networks to execute swaps through ParaSwap: Binance Smart Chain (BSC), Polygon Network, and Ethereum Network. Before realizing a swap, you have to choose a network to execute on, but keep in mind that each network has its pros and cons and a list of available tokens.
Realize a swap on the Binance Smart Chain
Launched in 2019, the BSC took to crypto world by storm during the 2020–2021 period and is now one of the most popular networks. The base currency for this network is the Binance Coin (BNB), which means that you always need BNB in your wallet to use the BSC since the BNB is used to pay the swapping fees. Right now, you can swap more than 230 tokens on the BSC on Dopamine, and the number of available tokens keeps increasing. To execute a swap on the BSC, select it in the drop-down menu on top of the swapping screen. Then, pick the tokens you want to swap and the token you wish to receive.
On the screen above, you can see a swap for 10 BNB to USDT. As you can see, ParaSwap’s Best Execution Engine is telling us that you will obtain the best price for our swap by routing 26% of the transaction through a DEX and 74% through another one. The best route always depends on the current liquidity for the pair.
At the bottom of the screen, you can see the transaction fees (“Estimated Cost”), the conversion rate for the pair (“Current Price”), and the “Minimum Received” of the desired token. With an estimated transaction fee of $0.46 on a $4,884 swap, the BSC applies a fee of 0.01%, which is truly competitive.
Realize a swap on the Ethereum Network
The Ethereum Network is the foundation for most of the DeFi ecosystem, but the network currently faces some shortcomings, including the rise of transaction fees. To execute a swap on the Ethereum Network, select it in the drop-down menu on top of the swapping screen. Then, pick the tokens you want to swap and the token you wish to receive. Here, you’ll need a minimal amount of Ether in your wallet to execute the swap since wallets running on the Ethereum Network use Ethers to pay transaction fees.
As you can see at the bottom of the screen, swapping 1 ETH to USDT cost around $45. This swap is around the same size as the previous one, but the fees are 100 times higher. So, when you execute a swap, you need to mind the transaction fees; if you’re not careful, the fees can be higher than the overall value of the swap.
If you want to check the state of the Ethereum network and its fee, you can use Etherscan’s Gastracker. As you can see above, sending an ERC-20 token will cost you around $17, while a swap on Uniswap costs $55. In our case, you should take the Uniswap fee into account since you’re executing a swap.
Realize a swap on the Polygon Network
Last but not least, Dopamine allows you to execute your swap through the Polygon Network, formerly Matic Network. Among the 3 networks available in Dopamine, Polygon boasts the lowest fees. To perform a swap on the Polygon Network, select it in the drop-down menu on top of the swapping screen. Then, pick the tokens you want to swap and the token you wish to receive.
As you can see above, swapping $4,600 of UNI would only cost us $0.01, making Polygon one of the cheapest networks to realize transactions.
With all that in mind, you’re now fully equipped to execute swaps on Dopamine through your favorite network! As time passes, Dopamine will integrate more and more networks. In the coming weeks, the Avalanche, Solana, and Cardano networks should be available; tell us in the comments which one you want us to integrate after! Stay tuned for guides on how to use Dopamine to the full extent of its capacities.