New version of 1inch’s DEX aggregator makes it cheaper than Uniswap

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The 1-inch team has released the third iteration of its aggregation log, a tool that routes trade orders across all decentralized exchanges on Ethereum and, more recently, on Binance Smart Chain.

The aggregation log calculates the most profitable trade for a given token and the size of the order, with a large order potentially being broken up into multiple blocks across multiple decentralized exchanges. Previously, the tool was mostly useful for wealthy traders for whom a slip-up was an important factor when trading decentralized finance. The system was consuming more gas than using a DEX protocol directly, which meant the product was unattractive to smaller traders.

The V3 version introduces gas optimizations that the team claims make the protocol cheaper than using Uniswap or 0x directly. In tests conducted by the team, the 1-inch V3 aggregator was about 10% cheaper than the same deals done through Uniswap in terms of gas and about 5% cheaper than 0x. Compared to 1 inch V2, the gas costs were reduced by up to 30%.

Comparison of gas costs for a large number of trades with the kind permission of the 1-inch team.

Anton Bukov, Chief Technology Officer of 1 Zoll, told Cointelegraph that Uniswap is the cheapest protocol for gas charges. This resulted in many copycats appearing on Ethereum and other blockchains, the most notable of which is SushiSwap. However, it appears that Uniswap’s trade router is not as efficient as it could be, with Bukov noting the following:

“Our router is more effective than yours. The same applies to SushiSwap and other forks. “

Thus, the 1-inch router only replaces Uniswap’s, while using the same pools. This explains how an aggregator can be cheaper than using it directly. The higher effectiveness of Uniswap is the result of targeted optimizations, said Bukov. Sergej Kunz, CEO of 1inch, added: “We only optimize where we can and sweep the dust after the other DeFi people, so to speak.” This would not be the first time that 1 Zoll has targeted Uniswap in its activities, after recently launching a “vampire air drop” for active Uniswap users. In this case, however, targeting makes the most technical sense. Because Uniswap’s code base is so popular, optimization offers the best return and liquidity.

The new version 3 has already been deployed and has replaced the previous iteration which can still be used. Switching platforms would require setting new token certificates, which would cost gas. Nevertheless, the migration seems to be able to pay for itself quickly.