➰InterCloud Swap
InterCloud trade capability leverages the Native Oracle of the Multi-Network and the decentralized exchange (DEX) module to provide clients with an easy and efficient option to trade assets. This feature allows users to exchange one cryptocurrency for another within the InterCloud ecosystem with ease.
With the help of the DEX module, users of InterCloud may exchange tokens in a decentralised, trustless manner without the need for middlemen. This enhances security and ensures transparency during the swapping procedure.
Additionally, the integration of the Multi Network's Native Oracle improves the accuracy of pricing data and real-time information for various assets. With the help of this Oracle technology, customers may participate in asset swaps with confidence as reliable and up-to-date market data is provided.
The purpose of InterCloud Swap feature is to improve the whole InterCloud ecosystem by giving users an easy and secure way to exchange assets.
How Token Swaps
Function Token swapping represents a foundational operation within a DeFi decentralized exchange (DEX) system. Decentralized exchanges like InterCloud Swap provide users the ability to deposit their tokens into the protocol and subsequently receive tokens of another type, aiming to maintain an approximate equivalency in value, while factoring in transaction fees, slippage, and price fluctuations.
Within the DeFi landscape, the process of a swap transaction is governed by smart contracts, removing the need for human or centralized intermediaries. This confers several benefits to users in comparison to traditional or centralized currency exchanges, including
Swift transaction speeds
Unrestricted trading access
Versatility and exposure to a diverse array of tokens
Non-stop market availability
Trading Fees
A Routing Fee is collected for each token exchange transaction made by users on InterCloud Swap. Usually, this Routing Fee represents 0.2% of the trade's value. In addition, depending on the trade's route, an LP charge could occasionally be added. A percentage of the fees received goes to the InterCloud Treasury, while the remaining amount is dispersed among the liquidity providers.
Slippage
Even with the rapid pace of token swaps on the blockchain, a slight variance—usually minimal—can exist between the price seen during the submission of a swap transaction and the price recorded upon the transaction's blockchain confirmation. This price variance is known as "slippage."
When engaging in a swap on InterCloud Swap, users choose a "slippage tolerance" value, representing the acceptable price difference during trade execution. The typical range for slippage tolerance is between 0.10% and 1.00%, with the default set at 0.50%. However, if the price difference exceeds this amount between submission and confirmation, the trade will not proceed. Users can adjust the slippage tolerance beyond the default 0.50%, but it's important to note that this might significantly affect the received token amount. The "Minimum Received" indicator offers an estimate of the trade's slippage impact.
For trades involving tokens with a reflect fee, the slippage tolerance must meet or exceed the percentage of the reflect fee for a successful trade.
Understanding Price Impact
Slippage doesn't solely arise from changes in prices due to other users' trades; it's also influenced by an individual user's submitted trade. This phenomenon is referred to as "price impact" and is represented as a percentage at the bottom of the swap module. If the slippage tolerance falls below the trade's price impact, the trade will not proceed.
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