1inch Exchange Fundamental Analysis

Overview

1inch exchange was developed in 2019 by Russian developers Sergei Kunz and Anton Bukov. Unlike many of the other exchanges in the crypto space, 1inch is an aggregator that sources liquidity from many other exchanges and uses smart contracts to optimize their users’ trades. Essentially 1inch is used to find the best rates for various cryptos across multiple platforms, that way you can get the cheapest prices and the lowest fees for your crypto purchases. The exchange integrates with popular DEX’s like Balancer, Kyber Network, Uniswap, Oasis and Mooniswap. 1inch supports over 250+ digital currencies and displays price and liquidity available on several different platforms so that the user can make an educated decision on which exchange to buy from.

How does it work?

 

1inch uses API technology to achieve the best possible routes for a given token swap, using multiple platforms to execute a single trade. WIth this method, you get a better rate on your trade than if you used one platform as price and liquidity varies across platforms. 


For more information on the technology that 1inch uses, I recommend giving their Medium post a read here

Features

1inch Token:

 

Unfortunately, the 1inch token doesn’t have as much utility as other tokens that I’ve analyzed in the past. Its two main use cases are utility and governance. For utility, the token is used to access the 1inch liquidity protocol where it is used as a connector to achieve highly efficient routing. Using the 1inch exchange in general is a form of utility though due to the fact that the exchange charges no gas fees or commission for trades as your orders are executed directly through other exchanges. You will still need to pay gas fees and commission but that will be through whatever exchange your order goes through, 1inch doesn’t charge anything on top of that. 1inch doesn’t have any deposit or withdrawal fees but also doesn’t have a relationship with fiat currencies, you will need to buy crypto on a different exchange and then send it to 1inch. 

 

CHI Gas Token: 1inch has a token called CHI which is an ERC-20 token that helps reduce your gas fees on 1inch. The value of the CHI gas token is pegged to the gas prices set by the Ethereum network. When buying CHI, you save 1% on fees compared to the Ethereum gas token GST2. When selling CHI, you save 10% compared to GST2. 

 

Mooniswap:Mooniswap is 1inch’s response to Uniswap and other swap exchanges. Moonswip has smart contracts that provide liquidity for ERC-20 tokens which helps prevent slippage in trades, thereby giving users more control over their trade and ensuring trades execute. 

 

Security: This is one of the best things about 1inch; because 1inch is an aggregator, they haven’t suffered any breaches or hacks. You don’t need to provide any personal info to use 1inch so data breaches aren’t that big of a concern and your crypto holdings aren’t held on 1inch so 1inch itself is inherently safe but be careful of which exchange you buy through. 

 

Customer support: 1inch has the following customer support features:

Email

Help Center

Live Chat

Support Group

Telegram Group

 

Token Supply Model

 

1inch token supply model taken from 1inch's Medium

Conclusion

There’s definitely not as much to talk about with this project compared to some of the other projects I’ve done analysis on. 1inch is all about providing you with the cheapest and highest liquidity trades possible, apart from that I can’t really recommend using the platform over goliaths like Binance and Kucoin which are swamped with various features, almost too many features really.  I’m mainly bullish on 1inch for 3 main reasons; 

1) Binance has invested in the exchange(I’m a huge fan of Binance and the Binance ecosystem, so definitely biased).

2) Logically speaking, we should all be using 1inch as it provides the cheapest trades, on top of this the platform is at a much lower marketcap compared to other larger competitors(more room for equity growth). 

3) Once institutions start investing in crypto more heavily, 1inch seems like the ideal platform to do this. When a company is investing hundreds of millions of dollars if not billions, it would make a lot of sense to choose the aggregator. 

 

Apart from this, 1inch is continuously expanding and updating the platform and so in the years to come I’m expecting good things from them. Their recent expansion to the Matic network is great news and indicates that the team is forward thinking. Keep a close eye on this project. 

 

Pros

-Good Track record of no hacks or data breaches

-UI is clear and easy to use

-no additional fees

-ensures high liquidity for trades all in one transaction

-CHI gas token can be used to reduce the atrocious gas fees

 –Mooniswap allows users to avoid slippage and take control of entry prices

-Binance invested

 

Cons

-no relationship with fiat

-beginners may find the platform difficult to use

-not as widely used as other exchanges so 1inch token may not have as much upside as other plays for this bullrun 

 

Price Prediction

I’m predicting 1inch reaches a minimum of $10 this bullrun which is only around a 2x from here so nothing too exciting. More movement is definitely possible given its market cap but I think the attention will be taken of Binance related projects and will be transition over to Polkadot and Cardano projects which I go over in my most recent blog post here.

 

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