What is Token Swap?
In cryptocurrency, ‘Swap’ is also known as ‘replacement/conversion’, so Token Swap is a term used to convert encrypted tokens from one blockchain to another.
Cryptocurrency assets can only exist in an invariable blockchain platform, so replacing a technical asset must provide new code, frameworks, or support structures. The process of introducing and launching new cryptocurrency units based on other technical platforms is called ‘Token Swap’ or ‘Coin Swap’. The term indicates trading a cryptocurrency asset for another asset at a 1:1 ratio, in which the old asset will be canceled and the new asset will completely replace and be awarded to the token holder sharing the same market value.
The project is often changed by using the Ethereum Blockchain to raise funds and distribute tokens. Tokens distributed at this stage serve as “placeholders” for users when the project starts. In particular, the outstanding benefits of the project allow traders not to lock in the capital and can trade placeholders on the exchange while developing their own technology. Therefore, the term “Token Swap” was born to describe the process by which the balance (of the token holder) is transferred from the ETH wallet to another compatible new wallet of the project. This token will be “transferred” from one Blockchain to another easily and efficiently.
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