How to buy crypto on a decentralized exchange?

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More and more users are asking how you can comfortably invest in cryptocurrencies. In this article, we will understand how you can buy cryptocurrency on DEX exchanges, using the example of Uniswap, the most famous decentralized exchange.

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What decentralized exchanges are there?

Cryptocurrencies gained their popularity due to the fact that it is a new tool for investing, where you really own your asset and no one can take it away from you.

However, more and more often there are cases when centralized exchanges block user accounts for various reasons, such as not being able to confirm the origin of funds.

For this reason, decentralized exchanges are gaining popularity, such as:

1. Uniswap - a decentralized exchange for Ethereum ecosystem

2. PancakeSwap exchange - a decentralized exchange for the Binance ecosystem

3. DyDx - an exchange working on Ethereum smart contracts, with the functionality of centralized exchanges, allowing even professional traders to feel comfortable.

Of course this is not a complete list of all decentralized exchanges, it is also worth mentioning such projects as SushiSwap, Curve and many others.

The advantages of working on decentralized exchanges.

Whereas in the days of older-generation DEXes like EtherDelta, you might have had problems placing orders because of the wrong gas. Now, DEX trade can be compared to buying stock from any broker.

Consider the benefits of this form of buying cryptocurrencies:

1. Investing in cryptocurrencies in a few clicks, fast and easy.

2. Your cryptocurrencies are stored in your wallet, no one can take them away from you.

3. As a rule, the best time to buy cryptocurrencies is before they are listed on centralized exchanges.

4. You are not tied to a particular exchange, your wallet as an account can be connected to another DEX exchange.

5. Real decentralization, no third-party control over your actions.

It must be said, that when you buy crypto this way, you are also deeply immersed in the field itself and are as much a part of it as other members of a huge community. You will better understand how blockchain works and why it is so secure.

The disadvantages of working on decentralized exchanges.

The pitfalls of this type of buying cryptocurrencies should not be forgotten. Because this is quite a young field, many people do not understand how to work with dex exchanges.

Now that we have touched on the advantages of this type of investment, it is worth talking about its disadvantages:

1. Security - this is both a plus and minus, because you are personally responsible for which site to connect your wallet to.

2. Vulnerabilities of different DEX exchanges. Despite the constant search for bugs, hackers can sometimes create problems, though most issues can be solved by users themselves being vigilant (eg, phishing sites)

3. Not all exchangers are as fast as the centralized, although in recent years, more and more rarely there are delays.

4. Attention to actions. If you add a token personally yourself, you need to check the contract.

These details need to be talked about because many users do not pay enough attention to them. As a result of their actions, they can suffer financial losses because they do not carefully handle their investments.

Does it mean that users should avoid this kind of investment? We think not, because it gives you quite a few more opportunities than those who still only use centralized exchanges.

Buying cryptocurrency using Uniswap exchange.

Now we will show you how you can buy crypto easily and safely.

First of all, you need to have a cryptocurrency wallet; in the world of cryptocurrencies having MetaMask is becoming a necessity. That is why we will work with it.

Then go to the link https://app.uniswap.org/#/swap and check the address of the site, as shown in the screenshot. You can also check the certificate issued by the site for certainty; it is a simple formality will help you avoid any problems. If in the process of checking, you have not any questions, and then proceed to the second point, the connection purse.

1

When you click on the Connect Wallet button, you will be prompted to select one type of wallet.

2

Since we will be working with MetaMask, we will choose it. You will get a message from MetaMask that your wallet is currently trying to connect to the site.

3

You will be prompted to select the address you want to connect.

4

Be sure to check what permissions you give the site to work with your wallet.

5

If everything was successful, you will see your wallet and balance.

Now let us move on to the buying process by looking at the Swap window.

6

In our case we will buy with Ethereum, then choose a token to buy.

7

In this case, we will try to use a token that is not on the list.

8

Through the search for the name of the token, then click Import.

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You will be prompted to check the token contract. If everything is correct, click Import.

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Once you have chosen your token, you can swap. You can use the max button for simplicity. It will suggest a suitable purchase volume.

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Then you will be given information about the price of the asset, the volume of purchase. To confirm you need to press the Swap button.

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In the next window, you will get more information about the commission. If everything is correct, press Confirm Swap.

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A confirmation-waiting window will appear. In addition, the metamask window will be activated, which will contain information about the total purchase price including gas. Click the Confirm button.

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After confirming the transaction, you can check your transaction in the Explorer.

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If you have not previously added a token to your list of assets, you can do so with the add button.

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You can check your assets in MetaMask in the Assets section.

In this article, we have tried to talk in detail about how DEX exchanges work on the example of Uniswap. Of course, the design of exchanges will be a bit different, but the steps in working with them everywhere are about the same - even if they run on completely different blockchains.

For example, we at Pontem Network have just launched Liquidswap, the first DEX for the Aptos blockchain. Aptos uses the Move language and can process up to 160,000 transactions per second with a time to finality of less than 1 second. Aptos will be ideal for DeFi, with a dramatically reduced risk of exploits and network downtime. Most of the problems we described above related to DEX exchanges will be completely solved by Aptos.

But while Aptos uses a radically different technology compared to Ethereum, the experience of our LiquidSwap DEX is very similar to Uniswap: if you’ve tried one, you’ll feel comfortable with the other. You can already test Liquidswap to appreciate all the benefits of Move.

About Pontem Network

Pontem Network is a dApp product studio building foundational dApps and development tools for Aptos, the most production-ready, scalable, and secure blockchain in the world. Together with the Aptos team, we are creating an ecosystem able to onboard the first billion blockchain users across the globe. Our products use the visionary Move coding language and Move VM – technology that was originally developed for Diem, a blockchain backed by Meta (Facebook).

The most important thing is to know the basics and to follow the basics of online security. Then DEX exchanges will be a real discovery for you in the world of investing in cryptocurrencies.

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