Difference between Coin Trading and Coin Swapping

Snapshot

• Coin Trading
• Coin Swapping

Over the years, the crypto market has grown massively and its demand is still on the rise. Cryptocurrencies are digital assets that can be sold, traded and bought online. To ensure security and integrity of the online transactions, blockchain technology is used. 

The most common and important terms associated with crypto exchange is trade and swap. Swapping in cryptocurrency is the process of exchanging one cryptocurrency with another, hence the term coin swapping.

Trading, on the other hand, is buying and selling of cryptocurrencies using exchange platforms.

Coin Trading

Coin trading has been the preferred way for transactions, in all these years. It is a simple transactional process in which crypto coins are exchanged for fiat currency or vice-versa. In trading a trader needs to have an account on an exchange platform. After an account is set up, a trader is free to trade with his funds. The crypto coins exchanged for currency are stored into digital wallets. 

For every transaction performed, trading platforms charge transaction fees, and since this method has been used for some time, investors have no other option than to pay the fees.

Coin Swapping

Coin swapping is different from coin trading. In coin swapping one crypto coin is exchanged for another crypto coin, directly, without the need for fiat currency. Most of the decentralized exchanges have incorporated this technology. 

In coin trading there is involvement of fiat currency. 

The exchange platform offers swap options with choices of swapping pairs. More the swapping pair options, better analysis of exchange. There are a lot of exchange platforms that provide hassle-free and user-friendly crypto swaps. 

For swapping of coins, a user is required to select the swapping pair and the amount of coins to be swapped. 

Both swap and trade have their pros and cons. But the final decision is on market volatility of cryptocurrency, investor requirements and swap market rate. But swapping can be more useful as it makes the crypto market more vibrant and easy to use.

Disclaimer: The article should not be considered as any financial advice. It is advisable to conduct thorough research before investment.

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