What is a Token Swap?

A token swap is a process during which investors swap their existing tokens for another kind. Own SOL, BNB, ETH? You can simply swap these tokens for NNI and have the exchange executed within minutes.

 

But what is so special about token swaps, and how do they differ from standard trading? Token swapping is exclusively performed on a DeFi protocol, particularly a decentralized exchange. These exchanges are non-custodial (meaning that they do not require ownership of your assets to move funds) and rely on liquidity delivered by users through the means of yield farming or liquidity mining.

Since decentralization is involved, swapping tokens is entirely regulated by smart contracts. There is no need for input from the exchange, nor are there any human factors involved that can lead to errors (except for those already embedded into code). In a different context, a token swap is referred to as the process of moving tokens from one network to another.

 

For a guide on how to swap tokens, see “How to swap tokens” under tutorials.