Safe{Wallet} now enables token swaps directly within the wallet, powered by CoW Protocol. A swap is the exchange of one type of token for another (e.g., ETH for USDC). Safe{Wallet} Native Swaps optimize trades by sourcing liquidity from multiple decentralized exchanges (DEXes) and protecting users from MEV attacks.
Key Benefits
Ease of Use: Swap tokens seamlessly within Safe{Wallet} without needing external tools.
Optimized Pricing: CoW Protocol aggregates liquidity from various DEXes, securing the best possible price.
MEV Protection: Maximal Extractable Value (MEV) refers to the potential profit that validators can extract by reordering, including, or censoring transactions within a block. While MEV isn’t always malicious, it can lead to tactics like sandwich attacks, where bots exploit slippage tolerance to maximize their profit at the user's expense. CoW Protocol mitigates these risks by delegating execution to professional solvers. These solvers use strategies like private mempools or setting lower slippage tolerances, abstracting the risk away from the user.
Batch Auctions: CoW Protocol batches multiple orders together to minimize slippage, resulting in better prices for users.
Gas Fee Optimization: Reduced gas fees as CoW Protocol finds the most efficient route for transaction execution.
How to Perform a Swap
Open Safe{Wallet}: Navigate to the “Swap” section.
Choose Tokens: Select the token you want to trade and the token you want to receive.
Enter Amount: Input the trade amount; the interface will display the estimated return.
Review and Confirm: Examine transaction details, including gas fees and price impact.
Execute Swap: Confirm the swap. The transaction will use CoW Protocol’s batch auction system for optimal execution.
Before approving you can view a detailed breakdown of all fees and estimated costs.
How to Set Up a Limit Order
A Limit Order allows you to specify a target price for your trade. The transaction will only execute if the market price reaches your specified limit.
When to Use: Ideal when you want to buy or sell a token at a specific price. Use it if you’re willing to wait for the market to reach your desired price.
Benefits: Guarantees that your trade only executes at your set price or better, which is useful for strategic buying or selling.
Steps:
Access Limit Order: In the “Swap” section, select "Limit Order".
Set Parameters: Define the desired price and the amount of tokens.
Set Expiration: Set an expiry time for the order.
Submit Order: Confirm the details and submit. The order will execute when market conditions match your specified price.
Your Open orders will be displayed on the right hand side with information on how close they are to executing and all other essential information.
How to Set Up a TWAP Order
A Time-Weighted Average Price (TWAP) Order spreads the trade over a period to minimize market impact and achieve an average price.
When to Use: Best for large trades, low-liquidity tokens, or implementing a DCA strategy. Use it if you want to minimize market impact and avoid significant price changes.
Benefits: Spreads out trades over time, reducing the likelihood of large price fluctuations and allowing you to achieve a more balanced average price.
Steps:
Access TWAP Order: In the “Swap” section, select "TWAP Order".
Set Parameters: Define the total trade amount, duration, and trade intervals.
Review and Submit: Confirm the setup and submit. Trades will automatically execute over the specified time, reducing market impact and improving price stability.
Conclusion
Safe{Wallet} Native Swaps make token trading secure, efficient, and user-friendly. With features like MEV protection, batch auctions, gas fee optimization, and privacy enhancements, Safe{Wallet} provides the tools you need to trade confidently, whether performing simple swaps, setting limit orders, or implementing a TWAP strategy.