1inch
Web3 / defi
1inch is a decentralized exchange (DEX) aggregator that sources liquidity from multiple decentralized exchanges and automated market makers to find the optimal trade routes for users, ensuring they receive the best possible prices for token swaps. Rather than operating its own liquidity pools, 1inch functions as an intelligent router that fragments orders across various DEXs like Uniswap, SushiSwap, and Balancer, leveraging smart contract execution to compare prices in real-time and minimize slippage. The protocol also offers limit orders, portfolio management tools, and its own token (1INCH) for governance and fee discounts, creating a comprehensive trading interface that abstracts the fragmentation of DEX liquidity. Example: When a trader wants to swap 100 ETH for USDC, 1inch's algorithm automatically splits the order across Uniswap, Curve, and other pools, executing portions on each platform where the price is most favorable, resulting in better execution than any single DEX could provide. Why it matters for DeFi: 1inch solved the fragmentation problem created by multiple competing DEXs by creating a unified liquidity layer. This aggregation approach improves capital efficiency, reduces slippage for traders, and has become an essential tool that demonstrates how smart routing can unlock value trapped across decentralized platforms.
Explore the full Web3 Glossary — 2,038+ expert-curated definitions. Need guidance? Talk to our consultants.