Staying safe · 6 min read
How to swap crypto safely
Swapping tokens on decentralized exchanges without getting burned: aggregators, slippage, price impact, token approvals, fake tokens and checking contract addresses.
Education, not financial advice. Rates change; DeFi carries smart-contract and depeg risk. Do your own research.
What a swap is
A swap trades one token for another. On a centralized exchange the company matches your order. On a decentralized exchange (DEX) you trade directly from your own wallet against a pool of tokens run by a smart contract. Aggregators check many DEXs at once and can split your trade across them to get a better overall price.
The swap tool compares live quotes from several public aggregator APIs without connecting a wallet.
Slippage and price impact
- Price impact is how much your own trade moves the price. Big trades in small pools get worse prices. A good quote screen shows it; if it’s more than a percent or two, consider a smaller trade or a different venue.
- Slippage tolerance is the worst price change you’ll accept between quoting and the trade going through. If the price moves further, the swap fails instead (you still pay the gas). Setting it very high invites bots to give you a worse price on purpose. For major tokens, a low setting such as 0.5% is common.
Token approvals
Before a DEX can move a token from your wallet, you sign an approval that lets a contract spend it. Many apps ask for unlimited approval by default. If that contract is later hacked or was malicious, it can drain that token.
- Approve only the amount you need when your wallet allows it.
- Read what your wallet says you’re signing. Be very wary of signatures you don’t understand.
- Review and revoke old approvals now and then with a tool such as revoke.cash or your block explorer’s approval checker.
Fake tokens and contract addresses
Anyone can create a token with any name and logo, including copies of real ones. The only reliable identifier is the contract address.
- Get the address from the issuer’s official site or a reputable data site such as CoinGecko, and compare it with what the DEX shows.
- Be suspicious of tokens that appear in your wallet unasked; interacting with them can lead to scam sites.
- Type URLs yourself or use bookmarks. Search ads and links in DMs are common phishing routes.
A safe swap, step by step
- Open the DEX or aggregator from a bookmark.
- Check you’re on the right network and the token contract addresses are correct.
- Compare the quote, price impact and fees. Keep slippage low.
- Approve only what’s needed, then confirm the swap and check the result in your wallet or a block explorer.