If there’s been one tech innovation that’s really changed the world in the past decade, it’s been the rapid popularization of cryptocurrency. There’s been a huge uptick in cryptocurrency adoption over the past few years, with more and more people coming to see the value of this new form of payment and value.
If you’re still new to the world of crypto, you might not be too familiar with the concept of crypto swaps. This is when you exchange one crypto coin for another. Sounds simple enough, but it can be more complicated than you’d think!
Read on and we’ll walk you through everything you’ll need to know about doing the best crypto swaps.
Benefits of Crypto Swapping
Many people new to the world of trading get confused between crypto trading and crypto swapping. This is because the end result of the two processes is more or less the same.
However, there are many benefits to crypto swapping that make it much more helpful to crypto-holders. It’s all about convenience and affordability.
Swapping allows you to – in an instant – trade two different forms of cryptocurrency. Normally, there’d have to be a transition from crypto to fiat currency, and then into the new cryptocurrency of choice.
Swapping skips this step, which speeds the process up. In addition, it saves the user the transaction and processing fees that often come with fiat-to-crypto exchanges.
How Does Crypto Swapping Work?
Crypto exchanges have gone out of their way in recent years to make the practice of crypto swapping much easier. These days, all you’ll likely need to do is log in and take a look at what swap exchange rates your crypto site of choice is offering.
It might be best to shop around, as the swap exchange rate might differ from outlet to outlet.
Both centralized and decentralized markets allow for swapping, and some cryptocurrency wallets may even allow for swapping within the wallet itself.
Are crypto swaps taxable? It’s important to note that unfortunately, yes, they are. A swap, much like a trade, will still get lumped in with your capital gains tax.
So while there are many benefits, avoiding your tax requirement isn’t one of them in this instance.
If you’re interested in swapping soon, you can read more information about accessing your new crypto to make sure you’re prepared to access what you come to obtain.
Understanding Crypto Swaps
If you’re looking to make a trade in the world of crypto in the near future, don’t move too fast! You’ll want to make sure you understand the ins and outs of crypto swaps first.
The above information can help fill you in on all you need to know about this alternative to trading and it’s many benefits.
Need more advice and information when it comes to the always-expanding world of cryptocurrency? Keep scrolling our blog for more helpful articles.