1inch, a decentralized exchange (DEX) aggregator which facilitates the exchange of tokens, unlike other DEXs that supply liquidity from a single pool, aggregating liquidity from multiple pools to give users the most efficient prices on trades, has added a P2P feature to its ecosystem to facilitate secure crypto swaps.
A unique feature about 1inch is how it scrapes a handful of decentralized exchanges for the cheapest prices and reroutes its customers’ trades between them to try and ensure that they’re getting the best prices, using its native token to power the platform. It works like this: a user finds a counterparty for swapping a certain amount of tokens while the counterparty provides them with a crypto address which the user enters in the P2P tab of the 1inch dApp.
What Is a Peer-to-Peer (P2P) Service
A peer-to-peer (P2P) service is a decentralized platform whereby two individuals interact directly with each other, without intermediation by a third party. Instead, the buyer and the seller transact directly with each other via the P2P service. The P2P platform may provide services such as search, screening, rating, payment processing, or escrow.
Today P2P services have moved beyond purely internet services, though they are mostly thought of as at least internet-based. Peer-to-peer services involve activities that range from simple buying and selling to those that are considered part of the sharing economy. Some peer-to-peer services don’t even involve a paid transaction by the users at all, but they bring together individuals to work on joint projects, share information, or communicate without direct intermediation.
In a bid to expand its eco-friendly system on all frontiers, the decentralized exchange aggregator (1inch) recently introduced peer-to-peer, or P2P, order functionality within the 1inch decentralized application, or DApp. Demand for this kind of service has been there for quite a while, but very few platforms currently offer it to users.
Having a sound broad base of the utility which P2P offers, 1inch sees this prospect too for which the feature will allow users to specify the person or wallet that will fill the other side of a trade, as opposed to over-the-counter or OTC payments where 1inch matches the order with a taker. The P2P feature is built on top of the 1inch Limit Order Protocol and is available on the following chains: Ethereum, BNB Chain, Polygon, Avalanche, Optimistic Ethereum, Arbitrum, and Gnosis Chain.
Leaping above More Walls
Furthermore, the company’s website disclosed that this opens the door to a whole new world of possible use cases, including transactions within NFT marketplaces, auctions, or reverse auctions. Although other services like Binance Pay or Bybit support P2P payments, it also buttered on the fact that the company has “stepped in to fill the gap” in demand for this kind of service. 1inch claimed that their P2P service offers trustless swaps, backed by smart contracts and complete decentralization.
With this additive feature, users can send orders via email or to any messenger using URLs that bypass 1linch’s backend. 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.