iMe & Uniswap
iMe• iMe swap process via Uniswap
• Why does my transaction cost X?
• My swap failed, what happened?
DEX benefits
The benefit of decentralized exchanges are funds safety which are in our own wallet rather than on exchange account. The transaction is carried out directly p2p, so a client to a client. The swap is used only for connecting a seller with a buyer and does not operate like a bank, where we hold funds and for which then we buy cryptocurrencies.
What is Uniswap?
Uniswap - is a decentralized exchange, a protocol for creating liquidity and trading ERC-20 tokens on Ethereum. It eliminates trusted intermediaries and unnecessary forms of rent extraction, allowing for fast and efficient trading. Where it makes tradeoffs - decentralization, censorship resistance and security are prioritized.
Uniswap is open-source software licensed under GPL.
If you want to dive into details check out the docs.
Uniswap protocol disclaimer - https://uniswap.org/disclaimer.
How do I use Uniswap?
First you will need is to activate your Ethereum account in iMe Wallet and some ETH on your balance. Head over to tab “Exchange” on the main page of the Wallet and select Uniswap from the list to start using the protocol to swap tokens. Remember that each transaction on Ethereum costs ETH (this is called the “gas fee” and it is paid to miners to keep the network running). iMe does not charge any swap fee, unlike other wallets.
How does Uniswap work?
Uniswap is an automated liquidity protocol. In practical terms this means there are template smart contracts that define a standard way to make liquidity pools and corresponding markets that are compatible with each other. There is no orderbook, no centralized party and no central facilitator of trade. Each pool is defined by a smart contract that includes a few functions to enable swapping tokens, adding liquidity and more. At its core each pool uses the function x*y=k to maintain a curve along which trades can happen. The pools keep track of reserves (liquidity) and updates those reserves every single time someone trades. Because the reserves are automatically rebalanced, a Uniswap pool can always be used to buy or sell a token without requiring a counterparty on the other side of a trade.
For a more in-depth description. Check out the How Uniswap works from the documentation.
iMe swap process via Uniswap
When swapping a token for ETH or for another token, a preliminary Approve operation is required, which is required only once and is executed by a smart-contract with Gas fee. Therefore, the first token swap takes place in 2 stages with 2 Gas payments: first for Approve, the second for the Swap itself. In the future, you will be able to exchange this token without an Approval operation.
Approve is a one-time transaction for ERC-20 tokens which is required before the swap begins. With this operation, you permit to swap your token over the Uniswap protocol using smart-contracts. Since this operation takes place on the Ethereum blockchain, the gas fee will be payed in ETH. You will not need to re-approve the current token.
When swapping ETH for tokens, you do not need to perform a preliminary Approve operation, and you can immediately make an swap, which is executed by a single smart-contract with Gas fee.
The exchange commission via Uniswap is higher than the usual transaction in the form of a transfer, since this is an operation on a smart contract, which requires more calculations and miners’ the power.
Swap operation settings
Swap time and fee
The faster is the exchange time, the higher is the commission. We recommend you to choose always the average transaction time.
Transaction deadline
Your transaction will be canceled if the waiting period is longer than this time.
Slippage tolerance
Slippage is the change in price between the time of placing your order for the exchange and its confirmation.
Your exchange will be automatically canceled if the slippage exceeds the set percentage.
Why does my transaction cost X?
Ethereum requires gas to execute each transaction. You can also check ETH gas station for the current prices required to complete transactions. Creating a Uniswap pool is a slightly costlier transaction because you are executing a more complex smart contract. Read more about how gas works in Ethereum.
My swap failed, what happened?
If a swap takes more than 20 minutes to execute, the router is programmed to fail the transaction. This is to protect the user from extreme swings in prices that can occur while the transaction is pending. If this happens, your tokens will still be in your wallet, but the gas fees paid are not recoverable. To keep this from happening, use a high enough gas price to have your transaction mined in under 20 minutes. This usually falls under “Standard” or “Fast” in most gas price calculators. Also, you can increase the transaction time up to 30 min.