Swap ERC20 Tokens

Utilizing the "1inch" Integration Pandora Finance's ERC404 DEX provides an effortless token swap feature, enabling users to easily exchange their ERC20 tokens for established ones without relying on conventional trading methods like order books. This integration ensures that users receive the most favorable swap rates by comparing prices across various pools within the multiple DEXs, offering the best possible quote for each transaction. Below is a simplified explanation of how the swap function works, designed to facilitate a smooth and efficient token exchange process.

Accessing the Swap Function

1. Navigate to Swap: Users can access the swap functionality directly from their ERC404 Collection page. Look for the “Swap Tokens” function to get started.

Token Selection and Exchange

2. Choose Tokens and Specify Amount:

   • Select the tokens you wish to exchange. You'll need to specify the amount of the input token you're looking to swap.

   • The interface simplifies the selection process, allowing for a smooth exchange between two chosen tokens.

Exchange Rate and Price Impact

3. Exchange Rate Calculation:

   • Rates are dynamically calculated based on the current reserves ratio within the liquidity pool, ensuring a fair and transparent exchange.

4. Price Impact Evaluation:

   • Before finalizing the swap, the interface will provide an estimate of the price impact. This is the potential difference between the expected exchange rate and the rate after the transaction, offering insight into the swap's market effect.

Finalizing the Swap

5. Transaction Confirmation:

   • Confirm your swap transaction through your wallet. This initiates the token exchange, transferring tokens between your wallet and the liquidity pool.

Benefits for Liquidity Providers

6. Fee Distribution:

   • A portion of the swap fees is rewarded to liquidity providers, incentivizing their continued contribution to the pool.

7. Adjusting Reserves:

   • Post-swap, the liquidity pool's reserves are adjusted to reflect the transaction, influencing the exchange rate for future trades.

This token swap functionality not only enhances the user experience by facilitating direct exchanges but also contributes to the liquidity and dynamism of the ERC404 ecosystem. With Uniswap's integration, Pandora Finance's ERC404 DEX users can enjoy a streamlined swap process, enabling them to efficiently manage their assets within the platform.