Over the last few years, as digital currency has grown in popularity, so has the adoption and use of decentralized exchanges. Despite the fact that decentralized exchanges provide users with access to a wide range of tokens available on the market, due to a lack of liquidity, users do not receive appropriate prices when crypto trading. This is why users visit various decentralized exchanges to compare prices and swap tokens, which can be a time-consuming and exhausting task.
Metamask (a well-known cryptocurrency wallet) introduced DeFi swaps, a price information aggregation feature that gathers data from professional market makers and multiple decentralized exchanges such as Uniswap, AirSwap, Paraswap, and others to ensure that users get the best pricing options with the lowest network fees.
This blog is for you if you’re thinking about investing in DeFi crypto wallet development or if you’ve already started developing your own DeFi wallet to get the most out of your business. In this article, we’ll go over the main advantages of using DeFi swaps in a decentralized crypto wallet.
The Advantages of Using DeFi Swaps in a Decentralized Crypto Wallet
Some notable advantages of incorporating DeFi swaps in a decentralized crypto wallet are listed below:
Real-time pricing data from a variety of sources
The first advantage of incorporating DeFi swaps during the development of a decentralized crypto wallet is that the user can access real-time data from multiple sources. The prices shown on decentralized protocols are determined by the type of token and the size of the swap. Users get access to the largest selection of tokens and the highest liquidity assets at the most competitive prices, rather than searching for prices offered by various decentralized exchanges.
Cuts down the number of token approvals
Integrating DeFi swaps into the wallet while developing DeFi in crypto wallets helps to reduce the number of token approvals. For each trade, there is no need to approve each token on multiple aggregators and decentralized exchanges. DeFi swaps in a crypto wallet allow users to approve a token only once, reducing not only the time it takes to execute a token swap but also the gas cost.
Reduced gas fees
Finding the best trade takes a lot of time and effort. Every aggregator must search multiple paths in order to find the best trade. The gas fee for completing a transaction varies by platform. It is a fee that users must pay in order to perform certain actions on a Blockchain. Despite the fact that users receive information from multiple decentralized exchanges, it is simple to identify the liquidity source with the lowest gas fees.
Increase the amount of protection against slippage.
Slippage protection is a mechanism that protects a user from high-risk situations and instant liquidations. Large swaps are subject to higher price swings due to insufficient liquidity on a particular decentralized exchange. Users can easily track the impact of slippage on the final price offered by a decentralized exchange because pricing information is available in one place.
Decreases the transaction failure rates
The transaction failure rate is greatly reduced due to the availability of a variety of pricing options. For example, the MetaMask Wallet’s swapping feature filters out trades with the highest chances of failing, resulting in a very low average failure rate of approximately 4.4 percent.
Provides liquidity analysis
Because token pair liquidity is constantly changing, relying on a single source of liquidity often results in a lack of market depth and high slippage. DeFi swaps’ data aggregation functionality provides users with accurate information about the crypto market and makes it easy to measure the liquidity ratio.
Conclusion
To summarize, incorporating DeFi swaps into your crypto wallet while developing a DeFi crypto wallet can provide your users with the advantages listed above as well as improve trade flow efficiency. Because there are numerous advantages to integrating DeFi swaps, cryptocurrency entrepreneurs have begun developing DeFi wallets.
Integrating DeFi swaps, on the other hand, could be difficult and time-consuming. A consultation from an experienced DeFi smart contract development company could be sought in such a situation.
We have a team of over 400 experts who work tirelessly to provide our clients with the best DeFi crypto wallet development services. We effectively cater to your needs with our business-oriented services, whether you want to create your own DeFi wallet or need any kind of development solutions. In-chat transactions, cross-platform compatibility, QR code scanner, multi-layer security, easy portfolio management, KYC verification, OTC trading, NFC support, automatic conversion rates, and many other features are included in our DeFi crypto wallet solutions.