Decentralised finance (DeFi) has opened up new ways to trade tokens without relying on centralised exchanges. If you’re holding cryptocurrency and want to swap it for another token quickly, securely, and without KYC, platforms like PancakeSwap and Uniswap are go-to tools.
Both are decentralised exchanges (DEXs) that allow users to swap tokens directly from their wallets. This guide will walk you through how to use PancakeSwap and Uniswap, covering both the Ethereum and BNB Chain ecosystems.
What is Token Swapping?
Token swapping is the process of exchanging one cryptocurrency for another directly from your wallet. For instance, swapping ETH for USDC or BNB for CAKE. There is no need for intermediaries; smart contracts handle the entire process.
Uniswap vs. PancakeSwap: What’s the Difference?
- Uniswap is the most decentralised exchange(DEX) built on the Ethereum blockchain and supports ERC-20 tokens.
- PancakeSwap is built on the BNB Chain ( Binance Smart Chain) and supports BEP-20 tokens. The swap process is very similar, but network fees and supported tokens differ.
How to Use Uniswap
1. Visit Uniswap: Go to https://app.uniswap.org
2. Connect Your Wallet: Click “Connect Wallet” and choose MetaMask or another compatible wallet.
3. Select Tokens:
- Click the “swap” field, select the token you want to swap (e.g., ETH).
- In the “To” field, select your desired token (e.g., USDC)
4. Enter Amount: Type in how much of the first token you want to swap. The app will auto-calculate the estimated amount you’ll receive.
5. Review Settings:
- Check slippage tolerance (default is usually fine unless the market is volatile).
- Look at gas fees (Ethereum can be pricey at times).
6. Confirm and Swap: Click “Swap” > Confirm the transaction in your wallet, and wait for confirmation.
How to Use PancakeSwap
1. Visit PancakeSwap: Go to https://pancakeswap.finance
2. Connect Wallet: Same process, connect MetaMask or Trust Wallet (ensure it’s set to BNB Chain).
3. Select Tokens:
- Choose the BEP-20 token you want to swap from.
- Choose the token you want to receive.
4. Adjust Settings:
- Slippage tolerance may need adjustment, especially for small-cap tokens.
5. Confirm Swap: Initiate the swap, confirm the transaction in your wallet, and wait for the block confirmation.
Tips for Token Swapping
- Double-check token contracts to avoid scams.
- Use DEX aggregators like 1inch or Matcha to compare rates.
- Always keep some native tokens (ETH or BNB) for gas fees.
Final Thought
Token swapping on Uniswap or PancakeSwap is a fundamental DeFi skill. It gives you control, speed, and access to thousands of assets. Once you’ve mastered swapping, you’re well on your way to participating fully in Web3.
Read also: How to Set Up and Use MetaMask Wallet
