1inch Token

What is 1inch Network (1INCH)?

1inch Network is an ecosystem of protocols that gives investors fast and secure access to various decentralized finance (DeFi) tools.

Best known for its initial decentralized exchange aggregator protocol, 1inch Network has quickly grown into a DeFi giant. In a constantly growing DeFi ecosystem, 1inch Network provides a crucial set of services for traders, making DeFi easy and accessible.

1inch claims it is “the most audited project in DeFi,” and this emphasizes 1inch Network’s focus on safety. Adding price and convenience to this proven track record of security, 1inch really is crypto’s one-stop shop for DeFi.

When Was 1inch Network Launched?

The 1INCH token was launched in December 2020. Users of the 1inch exchange platform prior to that date were airdropped 1INCH tokens as long as certain conditions were met.

Prior to the issue of the 1INCH token, the team secured $12 million in investment. Participants in this “series A funding round” included Pantera Capital and ParaFi Capital.

A few months earlier, 1inch had received $2.8 million in seed capital from Binance Labs, Galaxy Digital, Greenfield One, Libertus Capital, FTX, and more.

1inch completed its series B funding round in December 2021, raising $175 million. Amber Group led this round, which saw participation from 50 firms, including Jane Street, VanEck, Alameda Research, Celsius, Nexo, and Gemini Frontier Fund.

Who are the Founders of 1inch Network?

The 1inch Network was founded by Sergej Kunz and Anton Bukov during the ETHGlobal New York hackathon in May 2019. The pair had previously competed in multiple hackathons together, winning awards in New York as well as in Singapore.

Bukov is an experienced software developer who has been with DeFi since 2017. He has also previously had stints at gDAI.io and NEAR Protocol.

On the other hand, before founding 1inch, Kunz was a senior developer at product price aggregator Commerce Connector. He has also worked for the likes of Herzog, Mimacom, and Porsche.

How Does 1inch Network Work?

The 1inch Network features multiple protocols that provide DeFi users various services. These protocols include the 1inch Aggregation Protocol called Pathfinder, the Liquidity Protocol (once called Mooniswap), and the Limit Order Protocol.

Similar to traditional price aggregators that you can find on the web for most goods and services, 1inch aggregates prices and fees across different decentralized exchange (DEX) platforms.

1inch’s aggregation protocol, Pathfinder, lines up the best trading routes across multiple markets while also taking gas fees into consideration. When using Pathfinder, single trades can even be broken into smaller parts across different DEXs to give the user maximum efficiency.

Therefore, the aggregation protocol can take your trade order and then break it up and route it as necessary to provide the best possible execution. Best of all, this happens behind the scenes, and it counts as one single trade for the user.

Meanwhile, the 1inch liquidity protocol is an automated market maker (AMM) that lets users earn a passive income on their cryptocurrencies. Automated market makers use liquidity pools, which serve as counterparts for users to trade against.

Users who deposit funds into these pools and provide liquidity to the platform are called liquidity providers. When they deposit assets into these pools, they earn a share of the trading fees and are given liquidity provider tokens, or LP tokens, that they can use for yield farming.

Finally, 1inch’s limit order protocol does what it says on the tin: it lets traders use more advanced trading orders. Most DEXs let you swap currencies, which is the same as putting in a normal market order when trading. 1inch’s limit order protocol lets traders place orders like stop-loss and trailing stop-loss orders to more easily manage their trades.

What Makes 1inch Network Unique?

Price aggregators are extremely common, and almost anyone who has used them knows how much money it can save. 1inch Network provides the same service to DeFi users, and many out there swear by it.

There are umpteen decentralized exchanges on networks like Ethereum alone, and trawling for the best price is a laborious process, to say the least. 1inch Network solves that problem in a very handy manner, providing users with trade optimization across hundreds of DEXs.

Better still, 1inch network scans DEXs on not one, but ten networks. These include Ethereum, BNB Chain, Polygon, Optimism, Gnosis, Avalanche, Arbitrum, Fantom, Klaytn, and Aurora.

DeFi in general and decentralized exchanges can be daunting—even for more experienced cryptocurrency users. 1inch simplifies things by offering one-stop access to DeFi.

How is the 1inch Network Secured?

The 1inch token is deployed on Ethereum and BNB Chain since the 1inch Network doesn’t operate a blockchain of its own. As such, the security of 1INCH balances is ensured by Ethereum and BNB Chain.

However, as a major DeFi protocol that is all about the movement of funds, 1inch Network’s security is more than just a blockchain matter. The 1inch protocol is built with smart contracts, and these smart contracts must be audited rigorously.

In this regard, a list of 1inch audits can be seen on the project’s GitHub. Among the blockchain security companies to have audited 1inch are Certik, Chainsulting, SlowMist, and more.

What is the Use of 1INCH?

The 1INCH token is the native token of the 1inch network. It can be used for many purposes, such as sending money, staking, or governing a network.

Governance is a key part of the equation, as 1INCH token holders can propose and vote on updates to the 1inch protocols. 1INCH holders have the power to dictate changes made to fee structures on the different protocols, too.

Aggregation protocol governance proposals can change how the protocol’s “spread” is distributed. Liquidity protocol governance can dictate the parameters of each individual liquidity pool on the platform, including fees and rewards.

However, the main application of 1INCH as a utility token is in the 1inch liquidity protocol. Here, the 1INCH token is used as a connector to achieve high-efficiency routing.

Who Controls 1inch Network?

The 1inch Network is on its journey toward decentralization in three phases. The distribution of the 1INCH token by the 1inch Foundation was the first step toward implementing a decentralized autonomous organization (DAO).

Phase two is also complete, allowing 1INCH token holders to vote for various protocol settings. The final phase, planned for 2023, will see the introduction of full-fledged DAO functionality.

The end goal of this third phase is for the 1inch Network protocols and the 1INCH token to be completely decentralized, owned, and governed by the DAO. Until then, the 1inch Foundation retains a hand on the reins.

How Much 1INCH Is In Circulation?

1INCH has a total supply of 1.5 billion 1INCH tokens, with 621 1INCH in circulation. Currently, there are over 137,000 wallet addresses in possession of 1INCH tokens.

1INCH has a gradual token vesting schedule. Just 6% of the 1INCH token supply was unlocked, and the total supply will hit circulation on December 30, 2024.

30% of the total 1INCH supply is earmarked for community incentives, and 14.5% is in the network growth fund. Core contributors received 22.5% of the supply, and the rest went to various project backers.

How Do You Buy 1INCH?

1inch is one of the stalwart projects in the decentralized finance world, so it’d be quite strange if you couldn’t buy it on any less than a multitude of DEXs. The top DEXs on both the Ethereum and BNB chains provide plenty of liquidity for 1INCH tokens.

You can also buy 1INCH tokens across almost every major centralized exchange platform as well.

Is It Possible to Buy 1INCH Instantly?

The transaction speed when trading crypto tokens depends very much on where you’re doing the buying.

If it’s a DEX, it also depends on which chain and, if it’s Ethereum, whether the DEX is using a layer 2 scaling solution. Swapping by using a base layer Ethereum DEX, such as Uniswap V2, might be slow in comparison to transacting on layer 2 or BNB Chain.

CEX trades, meanwhile, are instant. Unfortunately, they do not entail actual settlement of coins until you withdraw them off the exchange and into your own wallet.

How Do You Store 1INCH?

The 1INCH token runs on two blockchains—Ethereum and BNB chain. You’ll need to choose a wallet based on which of these two chains you prefer. Luckily, there are many wallet options to choose from, and some wallets even serve both chains as long as you select the correct network when making a transfer.

You could also store 1INCH on a CEX account, but that defeats a big part of the purpose of holding the token. While staking—including on-exchange staking—can net you returns, you are giving up your right to participate in 1INCH governance if you keep your tokens in third-party custody.

1inch Network Energy Consumption

Both the Ethereum and BNB chains that host 1INCH are relatively clean when it comes to energy consumption. This is a new state of being for Ethereum, especially since its September 2022 shift to proof-of-stake saw its energy consumption drop by 99.95%.

Is 1INCH a Good Investment?

The 1INCH cryptocurrency token has often been labeled a “hidden gem” by some, but the reality is that the token has historically been outperformed by plenty of others.

Part of the reason for this could come down to its utility. The 1INCH token is a governance token, and the main reason for anyone to own it is to have the right to vote on 1inch Network’s protocols.

However, the march of the 1inch Network toward a complete DAO structure bodes promisingly for the 1INCH token. While governance is currently limited to aggregation and liquidity protocols, the DAO implementation will likely lead 1INCH holders to have sweeping control over the platform.

Thus, there remains significant potential for the 1INCH token’s value to grow, even if it simply retains its current utility. That in itself could be enough since 1inch Network is a valuable platform in its own right which is used by many—if not most—DeFi enthusiasts already.