EXPLAINER GUIDE: How To Use 1Inch Network’s P2P Feature to On-Ramp into DeFi

1Inch, the dex aggregator, has introduced a P2P feature to facilitate secure crypto swaps between individual users.

While 1inch network has grown tremendously since inception in 2019, the P2P feature has the potential to expand its user base in Africa and emerging markets which have demonstrated a preference for P2P functionality.

This is also an opportunity for African users that have shown great interest in cryptocurrencies to also explore DeFi, which is arguably more profitable.

A P2P order can come in handy in situations when liquidity for a certain token is not sufficient for a large OTC deal or, due to low liquidity, swaps on the market would incur significant slippage. The same applies to tokens that are not yet traded on the market, such as coins in the presale stage.

Here’s how you can use 1Inch’s P2P feature to provide liquidity:

2. Connect Your Wallet to 1Inch

First, connect your wallet to app.1inch.io.

Then, click on “P2P” within the swap window, and select the tokens you would like to swap. Once selected, you will need to approve the tokens for use by clicking ‘Give Permission.’

2. Creating a P2P Order

Enter the following information into the swap window:

• The amount of tokens you would like to swap
• The expiration date
• The taker’s wallet address

Creating an order involves two main parts. First, a user finds a counterparty for swapping a certain amount of tokens

Then, the counterparty provides them with a crypto address, which the user enters in the P2P tab of the 1inch dApp.

The swap could be executed at any rate the parties agreed upon or at the current market rate, supplied by 1inch’s spot price aggregator.

There is also an opportunity to select a specific percentage above or below the current market rate

SEE ALSO: DEX Aggregator, 1inch, Expands to Optimism Ethereum, a Layer 2 Scaling Solution, After UniSwap V3

3. Sending the Order

Once a P2P order has been created, the user can send it as a simple URL to the counterparty by email or via any messenger.

The URL contains the P2P order signed by the sender. The counterparty fills the order and pays the gas fee.

4. Filling the Order

First, go to the 1inch DApp, and connect your wallet.

Once connected, select the correct chain, and click on “P2P” within the swap window. Then, towards the bottom, click the “Inbound” tab, and then “Fill” under the correct order.

The main advantages of P2P orders on 1Inch are:

• P2P swaps are totally trustless as their execution is guaranteed by a smart contract
• Complete decentralization as data exchange is implemented by sharing URLs, bypassing 1inch’s backend

1Inch Network lets liquidty providers to scrape through a handful of decentralized exchanges in search of the most profitable platforms to invest.

Some of the supported blockchains include:

• Ethereum
• BNB Chain
• Polygon
• Avalanche
• Optimistic Ethereum
• Arbitrum
• Gnosis Chain.

The P2P functionality is built on top of the 1inch Limit Order Protocol and is available on all the supported blockchains.

RECOMMENDED READING: Understanding the Polygon Network and its Quest to Become an Internet of Blockchains

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