Why 1Inch Is Going To Explode In 2023

As DeFi continues to rise, invest in 1Inch - an emerging DEX aggregator.

Last Updated January 5th 2023

6 Min Read

Find out Why 1INCH is Going to Explode in 2023

2021 has been a remarkable year for digital assets. This year, several cryptocurrencies have created a big splash and garnered the attention of the community. 1Inch is one such cryptocurrency project. Based on predictions and market trends, 1Inch is likely to explode in 2023.

1Inch is a decentralized exchange (DEX) aggregator, which means it scours the cryptocurrency market to find the best rates and lowest fees for your trades. 1Inch offers users access to over 50 liquidity sources on Ethereum, 20 on Binance Smart Chain, and eight on Polygon. The list of DEXs it draws on includes the likes of Uniswap, 0x, Balancer, and its liquidity protocol, formerly known as Mooniswap.

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1Inch is a unique DeFi platform. Due to the different structures of decentralized exchanges such as Uniswap, Aave, etc., the selling price of the same digital currency varies slightly across trading platforms. Hence, 1Inch sends transactions to different decentralized trading platforms to significantly save costs and reduce transaction slippage. This sets 1Inch apart from other exchanges and contributes to its immense growth.

Among the transaction platforms supported by 1Inch are Uniswap, Kyber, Aave, Curve.fi, Airswap, mStable, Balancer, dForce Swap, 0x API, and 1Inch's very own Mooniswap.

1Inch is emerging as a future-ready DeFi platform, making now a suitable time to invest in it.

Several reasons back up the prediction that 1Inch is going to explode in 2023. Here are a few among them.

1. Low Fees and Best Trade Rates

The low fees and fast transaction capabilities make 1Inch an enticing investment option.

Anyone can enter the DeFi sector using the 1Inch network’s intuitive dashboard. This online interface will remove all the technical barriers associated with DeFi functionalities and allow users to track their investments in real-time from anywhere globally.

The 1Inch Aggregation Protocol can check prices across multiple decentralized exchanges (DEXs). The protocol supports DEXs across the Ethereum, Binance Smart Chain, and Polygon blockchains. In this way, 1Inch Network users always receive the best rate for a swap.

1Inch introduced an Ethereum Gas Fee-pegged token called Chi to provide users with lower fees. In comparison to Ethereum fees, 1Inch network users pay around 40% less on average.

2. Updated 1Inch Liquidity Protocol Versions

1Inch offers cutting-edge trading offerings, making it a stellar investment choice.

The 1Inch Liquidity Protocol V2 uses a mechanism that increases with price slippage to ensure that liquidity providers and 1Inch token pledgers obtain higher returns through volatility.

It contains the 1Inch Pathfinder algorithm, which acts as a bridge to split an exchange transaction by effectively using the many market depths in the same protocol.

Market Depth is an essential indicator of the supply and demand relationship of cryptocurrencies based on the number of publicly-traded orders. The V2 version of the 1Inch Liquidity Protocol fully shortens the response time and helps users process transactions more efficiently.

According to Dune Analytics, 1Inch's transaction volume has surged after the end of 2020, mainly because of the updated version of its platform V2. 1Inch's V2 platform adds some more complex transactions to the original basis to keep prices low, such as rescheduling funds dedicated to loan collateral for the decentralized lending protocols Aave and Compound.

The platform also introduced Aggregation Protocol v3 in 2021 to reduce transaction costs. The main improvement in version 3 was the ability to reduce gas fees due to assembly code optimization. The feature applies to swaps using Uniswap v2 and its forks, such as Sushiswap, LuaSwap, etc.

Thanks to the upgrades, 1Inch has solidified its leading position in the DeFi space.

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3. 1Inch Tokens

1Inch coins play a vital role in the ecosystem, making it a must-buy cryptocurrency.

The 1Inch platform launched its crypto token 1Inch in December 2020. The total circulation is 1.5 billion pieces. The primary function of 1Inch tokens is governance participation, such as modifying transaction fees, recommendation rewards, etc.

There are two types of governance: pool governance and factory governance. Users can use it to vote on the operation of the 1Inch platform and achieve instant authority.

Chi Gas is a network token used to power 1Inch transactions. It is pegged to the Ethereum network’s gas price. However, it is only minted when the gas price is low and burnt when it is high. This strategy provides significant savings to all users.

1Inch is not only an aggregator but also has its own exchange Mooniswap. Therefore, governance can be divided into liquidity agreement governance and aggregation agreement governance.

4. Governance And Farming Pools

Thanks to its unique capabilities, 1Inch is a fast-growing platform with a lot more potential in it.

1Inch token holders gain the right to put forth proposals to a community vote. The network’s governance mechanism determines the weight of your vote based on the amount of 1Inch you hold in a network wallet or have staked. The system employs a decentralized autonomous organization (DAO) protocol to provide decentralized management to the network.

Farming is another DeFi feature that 1Inch Network users can access. Many investors prefer farming over staking because there are no required lockup periods or early withdrawal penalties. In this way, you can access your tokens if you need them without fear of losing rewards due to penalties.

Why Is 1Inch Going To Explode In 2023?

1Inch's plans to expand the networks and the launch of 1Inch's v3 are few significant reasons why 1Inch is likely to explode in 2023, securing a special place in investor portfolios.

The launch of the 1Inch V2 platform in late 2020 made transactions quicker and cheaper, adding more complex trades to keep prices low, such as rerouting money earmarked as collateral for loans on decentralized lending protocols Aave and Compound. In March 2021, it was followed by the launch of 1Inch's v3 aggregation protocol, which reduced gas fees by a claimed 30% over 1Inch v2.

The project has expanded beyond its initial ambitions to provide a DEX aggregator, with Mooniswap AMM replaced by the fully integrated 1Inch Liquidity Protocol in December 2020. In addition, April 2021 saw the launch of the 1Inch Wallet app for iOS, which incorporates the web app's feature set into a mobile wallet.

The future of 1Inch depends on that of decentralized finance. Decentralized exchanges are still expensive, slow, and relatively insignificant compared to mighty centralized exchanges such as Binance. But with centralized exchanges suffering repeated bouts of downtime during periods of crypto price volatility, the appetite for DEXs is growing, and aggregators like 1Inch are there to pick up the slack.

Some of the 1Inch token supply is earmarked for development, which has seen the exchange integrate new liquidity protocols rapidly. So long as the market does not bottom out, there is no reason to suspect that the pace of development will slow any time soon, making now the right time to buy 1Inch tokens.

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Bottom Line

1Inch serves a vital role in the DeFi sector today. The platform enables regular users to secure passive incomes, save on trades, and find the best rates possible. In addition, the developers continually upgrade the network to incorporate new features and services. For these reasons, 1Inch is likely to explode in 2023.