Not too long ago, the only way to convert a token from one blockchain into a token on another was going through a centralized crypto exchange. Thanks to innovations in DeFi, however, that’s no longer the case.
Now, you can seamlessly swap tokens across blockchains using a cross-chain swap right in your Magic Eden Wallet.
Read on to learn about cross-chain swaps, how they work and how you can swap tokens across multiple chains.
A cross-chain crypto swap is the process of exchanging a token between two blockchains without relying on a third party.
Instead of using a third party like an exchange to convert tokens, a cross-chain swap uses smart contracts to exchange one token on one blockchain for a token on another while ensuring the security and authenticity of the transaction.
This lets you skip the waiting times associated with transferring tokens to exchanges, trading them on those platforms, and then withdrawing them back to your wallet.
You’ll also likely save on fees. Cross-chain swapping is generally cheaper than going through centralized exchanges.
Cross-chain swaps differ in many ways depending on the type of swap you need them to achieve. However, they generally rely on two independent users swapping their tokens for each other. The swapping parties may know each other, i.e., be in direct contact or connected through different swapping providers.
In most cases, the swap is facilitated through a smart contract that’s specially designed to ensure only the two participants have access to their funds.
This contract uses an escrow feature (secured by cryptography) to ensure each user will access their funds at the same time. This means nobody can cheat the smart contract into keeping their funds as well as the swapped tokens.
Some blockchains, like Polkadot and Cosmos, connect several chains, enabling swaps using their own technology. This means no additional providers are needed, as the blockchains offer this feature by themselves.
In most cases, however, you have to use a swapping service like the one offered by Magic Eden Wallet.
There are four main types of cross-chain swaps currently available. They work in slightly different ways. These are:
Cross-chain swaps are a built-in feature on the Magic Eden Wallet. This saves you the hassle of having to transfer funds to an exchange, sell them, buy the tokens you want, then send them back to the wallet.
Instead of that tedious process, you can do it in a few seconds or minutes through the ME Wallet.
We’ll assume you’ve already installed the Magic Eden Wallet and completed the setup process on either your mobile phone or desktop browser. So now, we’ll walk you through swapping your funds using the wallet’s cross-chain swap.
Under the Swap option, you’ll get to choose which token you’re offering and which one you’re getting in return.
After this, just click ‘Swap’. Easy peasy!
Because ME Wallet uses third-party API partners for swapping, it’ll take several minutes for the swap to complete. However, the wallet allows you to continue doing other things, while it finishes the swap for you in the background.
Cross-chain swaps simplify how we move assets from one blockchain to another. You also enjoy flexible fees and minimum slippage without having to go through multiple third-party exchanges.
The fastest way to swap crypto is arguably using a wallet’s built-in swap option. The Magic Eden Wallet offers this feature. It only takes a few seconds to set up, and once you click ‘Swap,’ the process is complete within a couple of minutes. It usually doesn’t take long to swap tokens across different chains.
Cross-chain crypto swapping lets you near-instantly trade one cryptocurrency for another without having to mess with fiat or go through a centralized crypto exchange. It’s quicker, often cheaper, and gives you access to a broader range of tokens.
Most swaps happen on decentralized platforms, giving you more privacy and control compared to centralized exchanges. Finally, swapping makes cross-chain transfers super easy, so you can move assets between different blockchains without breaking a sweat.
While traditional markets have opening and closing times, crypto markets are available 24/7. Still, the best time to swap crypto is when network activity is low, which tends to be early in the morning or late at night.
Usually, markets will be busier (and fees higher) during working hours. Try to aim for just before and just after your working hours, but for optimal results, keep US working hours in mind as well—after all, it’s one of the biggest crypto markets.
You could also check gas trackers for different blockchains to see when the fees are at their lowest. Whenever you’re ready, the ME Wallet only takes a few clicks to finish the swap.
A cross-chain swap lets you exchange any token for any other token as long as the swapping provider offers both tokens that you want. A bridge is a way for one token to work within another blockchain. When bridging, you’re creating the same token (but in wrapped format) on another chain in order to be able to use it. When swapping, there are no such restrictions.
An on-chain swap means swapping tokens on the same blockchain, such as swapping one ERC-20 token for another on Ethereum. Your tokens aren’t leaving the ecosystem, as both are based on the same chain. A cross-chain swap means taking the leap from one blockchain to another, like swapping BTC from the Bitcoin network to ETH on Ethereum.
Yes, swapping crypto is generally safe. It’s enabled through smart contracts, which are specially designed to be secure. Since there is never a guarantee that something is completely safe, it’s a good idea to use secure and audited service providers. The Magic Eden Wallet uses the best security practices.
The information provided on this website is provided for general educational purposes only and is in no way financial or investment advice. Certain information may have also been provided to us or prepared by third parties; these materials are provided for convenience and are not an endorsement by Magic Eden. Magic Eden is not liable for any errors, changes or amendments to such information, including any actions taken in reliance on such information.
