Cryptocurrency pairs are assets that can be traded for each other on an exchange. There are two main reasons for investors to understand trading pairs: for instance, some cryptocurrencies can only be bought with other cryptocurrencies and knowledge of crypto trading pairs gives savvy crypto investors the chance to exploit arbitrage opportunities — the chance to profit from differences in asset prices between markets.
Some crypto exchanges do not offer pairings for cryptocurrencies and fiat currencies like the U.S. dollar (USD), but exchanges like Gemini, Coinbase, Binance, and Kraken do offer fiat trading pairs. As they have the most exchange options, the most versatile cryptocurrency pairs to trade are usually BTC and ETH.
Trading pairs base currency
A base currency has been established as a common trading pair on exchanges. For crypto-only exchanges, investors need to have one of these pairs before they can trade. In most cases, these are the most popular cryptocurrencies that you could buy like BTC, ETH, BNB, USDT etc.
Regrettably, issues with crypto trading pairs are related to lack of liquidity in decentralised or decentralised exchanges and blockchains connectivity. This means that it is strictly impossible even for the largest centralised exchange like Binance (with an average daily volume of 2 billion dollars and over 1.4M transactions per second) to keep enough liquidity for all possible pairs. For instance, Solana the 5th most traded presently in 2021 can only be traded for ETH, BTC, BNB and USDT, or 4/9 of the top 10 possible pairs in the top ten.
This is where a new free online tool Swap Cryptos come into play allowing investors to know the best and optimal way to swap any crypto at any time. For instance, it will be possible to swap or trade AAVE (popular for its non-custodial protocol) for CRV (a decentralised exchange and automated market maker protocol).
This means that crypto holders might need to sell AAVE to get ETH and use ETH to buy CRV. Whereby, going via USDT as a traditional option might not be the cheapest and most efficient path available. Furthermore, not all cryptocurrencies can be purchased with fiat.
Why is Crypto Swaps different?
There are many ways to transfer cryptocurrencies, crypto trading or swaps allow instantaneously exchange of one cryptocurrency to another without having to first undertake a crypto-to-fiat exchange. Over the last few years, we have seen the launch of prominent platforms like Changelly, ShapeShift, and AirSwap. These platforms charge at least 5% in fees and still are able to support a limited number of pairs available. For instance, Changelly at present has around 250 pairs.
Swap Cryptos is a free web interface that allows for easy research with the Binance exchange. The interface is launched in December 2021 in beta and relies on donations to operate.
The Swap Cryptos tool helps analyse over 6.2M crypto pairs to find the smartest way to exchange crypto using the investor’s own Binance account. Unlike other decentralised exchanges, it does not use third-party assistance to store and manage the funds of the traders.
How Swap Cryptos works:
- Select the cryptocurrency pair you’d like to exchange.
- Connect to Binance and perform the Buying and Selling function using market, not limit orders.
Swap Cryptos is essentially a smart engine that performs real-time price calculations to find the best deal for its users, it supports Binance intending to expand to other exchanges like Coinbase and Kucoin in Q2 of 2022.