Introduction
1inch is a DEX aggregator and liquidity protocol (AMM), now rebranded as the 1inch Liquidity Protocol after launching its 1INCH token. It combines DEX aggregation with an exchange featuring a unique AMM model prioritizing liquidity provider (LP) profits.
Uniswap, meanwhile, remains the most popular decentralized exchange (DEX), leading in TVL (Total Value Locked) and trading volume. Both platforms support ERC-20 tokens and cross-chain assets, enabling users to trade and earn via liquidity pools.
But which platform is better for traders or LPs? This guide compares fees, liquidity, and use cases to help you decide.
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Trading on 1inch vs Uniswap
When to Use Uniswap
- Small, quick trades: Uniswap saves on gas fees when only one liquidity source is needed.
- Low-price-impact swaps: Uniswap’s straightforward model avoids slippage risks from aggregated routes.
Example: Swapping 1 ETH to AAVE on Uniswap cost lower gas fees vs 1inch (pre-Router v5).
⚠️ Avoid trading on DEXs during high gas fees—use CEXs like Binance (0.06% fees) instead.
When to Use 1inch
- Best-price discovery: 1inch scans 40+ liquidity sources (e.g., Balancer) for optimal rates.
- Split orders: For large trades, 1inch combines multiple pools to minimize slippage.
Example: 1inch routed an ETH→AAVE trade via Balancer, offering more AAVE tokens than Uniswap.
Caution:
- Verify actual rates—some 1inch quotes may overestimate prices.
- Post-Router v5, gas fees are optimized, making 1inch more competitive.
Key Takeaways
| Scenario | Best Platform | Why? |
|---|---|---|
| Small trades | Uniswap | Lower gas fees |
| Best-price hunting | 1inch | Aggregates 40+ sources |
| High-liquidity trades | 1inch | Splits orders |
Providing Liquidity: 1inch vs Uniswap
Liquidity Metrics
- Volume/Liquidity Ratio: Higher = more fee earnings for LPs.
Fee Structures:
- Uniswap: Flat 0.3%/0.05%/1% fee (goes to LPs).
- 1inch: Variable fees + price-impact fees + decay period (boosts LP profits).
Liquidity Mining
Both offer token incentives (UNI/1INCH) for staking LP tokens. Check active programs before committing.
Key Considerations
| Factor | Uniswap | 1inch |
|---|---|---|
| Fee Simplicity | ✅ Fixed | ❌ Variable |
| LP Profit Potential | Moderate | Higher (with decay) |
| Impermanent Loss Risk | Equal | Equal |
UNI vs 1INCH Tokens
Market Position
- UNI: Top 20 token, listed on Binance/Kraken.
- 1INCH: Smaller cap, available on Binance/KuCoin.
Investment Outlook
Both tokens could benefit from DeFi growth, but UNI has broader adoption.
Where to Buy:
- Binance (lowest fees: 0.06% + discounts).
FAQs
1. Is 1inch cheaper than Uniswap?
Not always—gas fees depend on trade size. Use 1inch for best-price routing, Uniswap for simplicity.
2. Which pays LPs more?
1inch (with decay/price-impact fees), but Uniswap pools may be more stable.
3. Can I use both platforms?
Yes! Diversify across trading (1inch) and liquidity (Uniswap).
Conclusion
- Traders: Use 1inch for best prices, Uniswap for small trades.
- LPs: Compare fee structures and mining programs.