What is cryptocurrency 1inch (1INCH) and how does it work?

What Is 1inch?

1inch is an innovative app that rests on a tall technology stack.

The 1inch dApp is a DEX aggregator that searches a handful of DEXes and hundreds or thousands of liquidity providers to find the best deal on a trade you want to make. You specify the cryptocurrency you’re offering and the crypto you want to acquire, and the dApp does the rest. It’s like those websites that help you find the best deal on a car loan or airplane ticket.

When 1inch started, the dApp searched only a handful of DEXes for deals. Today, 1inch uses an algorithm called Pathfinder to locate the best price by searching liquidity providers on the Ethereum, Binance Smart Chain, and Polygon blockchains. The dApp can split transactions among multiple partners for the best deal. In its first two years, the dApp handled more than $50 billion in crypto swaps on the Ethereum network alone.

Supporting the dApp is 1inch’s liquidity solution, which allows you to earn transaction fees by staking crypto funds to 1inch Network liquidity pools.

In June 2021, 1inch replaced its Ox-based limit order engine with a new protocol developed in-house. The 1inch limit order feature lets users specify a price for buying or selling crypto assets. The transaction is put on hold until the specified price is met, then automatically executed.

1inch’s limit order solution lets you specify a wide range of non-price conditions for the execution of your orders. For example, an order could be executed based on the results of a national election as provided by a blockchain oracle.

How Does 1inch Work?

1inch calculations happen under the surface. The proprietary Pathfinder algorithm maps out optimum terms for crypto swaps that may involve two, three, four, or more exchanges. The algorithm may split the transaction among multiple exchanges or providers to guarantee the best possible exchange rate.

1inch currently supports swaps among coins and tokens that conform to the ERC-20, ERC-721, ERC-1155, and BEP-20 standards. This accounts for most of the widely used cryptocurrencies on the market. 1inch notes that additional tokens could be supported via external extensions. 

But those details are not presented to users. The 1inch interface simply asks what kind of tokens you have and what kind you wish to purchase. The screen then shows you the best deal and a handful of other options. Click “swap now” and the transaction is executed. You are also offered a choice of standard, fast, or instant processing. If you’re willing to pay a higher gas fee, you can expedite the swap.

High gas fees are a major concern these days. All 1inch transactions show you the gas costs and give you options for minimizing them. You can often save money on gas by paying the fees with 1inch’s CHI token. It’s a simple checkbox on the swap screen.

In addition to simple swaps, you can place a limit order by specifying the target prices for future trades or earn money by staking crypto funds to liquidity pools that are used by DEXes and groups of DEXes. The 1inch dApp clearly presents the returns you will earn for making your crypto funds available for a day, a week, or a month.

Who Are the Founders of 1inch?

1inch was born at the May 2019 ETHGlobal hackathon in New York. But the project’s roots go deeper.

Russian programmers Sergej Kunz and Anton Bukov met in 2017. The two shared an interest in blockchain technology, smart contracts, and security. Bukov was a frequent guest on Kunz’s Russian-language CryptoManiacs YouTube channel and eventually became co-host.

Kunz and Bukov conducted smart-contract security audits for Russian companies and they began competing in crypto hackathons around the world for fun. The CryptoManiacs team generally won enough cash prizes to cover the hotel and airfare costs of participating in the competitions.

They didn’t win any big prizes at the 2019 ETHGlobal competition, but they returned from New York with the code for a working DEX aggregator. They kept working on the code, and in July 2020 CryptoManiacs became 1inch Limited, a Spanish corporation with Kunz as CEO and Bukov as CTO.

1inch has raised $14.8 million over four rounds of financing.

1inch 1INCH

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Ethereum ETH

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XRP XRP

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What Gives 1INCH Value?

1inch launched the 1INCH token on Christmas Day 2020. 1INCH is primarily a governance token, meaning that those who hold the tokens get to vote on policies and strategies for the 1inch platform.

1INCH is not intended to be an investment. “The 1INCH token is not for sale to users,” says a post on the 1inch blog. “It is a reward for using 1inch products.” 

In addition to providing a mechanism for decentralized governance, the 1INCH token functions as a utility token that secures funds for ecosystem development, incentivizes participation in governance, and allows staking for network security. Users can earn 1INCH tokens by lending funds to 1inch Network liquidity pools.

Users of the 1inch DEX aggregator and other services don’t need to visit exchanges to purchase 1INCH tokens. They are not needed to use the service.

1inch’s second token is called CHI. It’s an ERC-20 “gas token” that uses the Ethereum Storage Refund protocol and other technology to allow 1inch crypto transactions to take place with significantly reduced gas charges. 

CHI is pegged to the Ethereum network’s gas price, but the tokens are minted only when the gas price is low and burned when the gas price is high. That’s one way the token minimizes gas fees for user transactions.

How Many 1INCH Coins Are in Circulation?

1inch launched the 1INCH governance token with a Dec. 25, 2020 airdrop to the 1inch user community, creating what 1inch founders called “instant governance.” 1inch distributed 6% of the 1.5 billion total tokens. 1INCH tokens are currently in circulation.

1inch CHI tokens are traded at 1inch and other exchanges. The tokens can be minted at 1inch or EtherScan.

How Is the 1inch Network Secured?

1inch has subjected its code to audits by teams from OpenZeppelin, ConsenSys Diligence, SlowMist, Haechi Labs, CoinFabrik, CertiK, Hacken, Scott Bigelow, MixBytes, and Chainsulting. Results of the security audits are listed and linked at the 1inch website so you can inspect them.

These audits are ongoing. For example, when 1inch released its liquidity protocol, it had eight independent agencies audit the code. The audit results are linked at 1inch’s GitHub page.

Further supporting security is a technical provision of the 1inch liquidity solution. The code protects against potential front-runner attacks, in which an observer learns about an intended trade and takes action to disrupt the trade or make a profit by acting upon the information before the trade is finalized.

How To Use 1inch

The best way to use 1inch is to visit the website and try to execute a few trades. The user interface is simple, but it provides enough flexibility to give you a high degree of control over crypto swaps. 1inch lets you explore trades and prices without executing them.

Getting started at 1inch is easy. Just create an account, connect your wallet, and define the crypto swap you would like to make.

How To Choose a 1inch Wallet

1inch’s proprietary wallet is integrated into the app, providing seamless access to swaps. But you can use any Ethereum-compatible wallet to make swaps at 1inch. If you’re already using a wallet to hold your crypto funds, there is little benefit to using the 1inch wallet. It is simple to give the 1inch dApp access to your wallet.

The same goes for hardware wallets, which provide an extra level of security. Hardware wallets from Ledger, Trezor, KeepKey, and Prokey ensure that a hacker who gains access to your PC or smartphone doesn’t automatically get access to your crypto funds.

You can also store 1INCH tokens in online wallets or web wallets, which are free, easy to use, and accessible from multiple devices using a web browser. They are, however, considered hot wallets and can be less secure than hardware or software alternatives. As you are likely trusting the platform to manage your 1INCH, you should select a reputable service with a track record in security and custody. As such, they are most suited for holding smaller amounts of cryptocurrencies or for those making more frequent trades.

Kriptomat offers a secure storage solution, allowing you to both store and trade your 1INCH tokens without hassle. Storing your 1INCH with Kriptomat provides you with enterprise-grade security and user-friendly functionality.

Buying and selling 1INCH, or trading it for any other cryptocurrency, is done in mere moments when you choose our secure platform as your storage solution.

Bottom line

1inch is a DEX aggregator that explores hundreds or thousands of sources to ensure you get the best price on every crypto trade. The innovative service is delivered in a dApp that runs on the website and mobile devices.

1inch has launched two tokens. 1INCH is the “instant governance” token that helps fund the operation of the 1inch network. CHI is a gas token that allows users to minimize gas fees when they execute transactions via the 1inch dApp. Neither token was created as an opportunity for investors.

1inch FAQ

There is much more to learn about the 1inch network than you have read here. We recommend a visit to the website, where you’ll find background material, technical details, and blog posts packed with technical data about the 1inch dApp and tokens.

How to Buy 1INCH

Buying 1INCH is as easy as visiting Kriptomat’s how to buy 1INCH page and choosing your preferred payment method.

How to Sell 1INCH

If you are storing your 1INCH in your Kriptomat wallet, selling is a simple matter of pressing the Sell button.

1INCH Price

You can see the current 1INCH price and a detailed price history here at Kriptomat.

The price of 1INCH is influenced by market factors, news events, economic developments, and the general state of the international economy.

The current price is EUR and the 24-hour trading volume is EUR.

1INCH is currently ranked of all cryptocurrencies, with a total market capitalization of EUR. It has a circulating supply of and a max supply of tokens.

If you’re experiencing any issues or have any questions at all, please don’t hesitate to reach our Customer Support Team. We’re always here to help!