Last week decentrailzed finance (DeFi) researcher Michael Nadeau highlighted a strange transaction in which someone swapping two stablecoins, USDC for Tether, started with $221,000 but only received $5,000. Was it a fat fingered trader who was fleeced, or money laundering?
If one were executing a similar transaction via online banking, they usually ask you to approve the FX rate. If you don’t agree quickly enough, the rate changes.
DeFI automated market makers (AMMs) take a slightly different approach so that all the questions are asked in advance. Instead of requesting rate approval, they ask how much slippage you are willing to tolerate when swapping two cryptocurrencies.
Article continues …
Want the full story? Pro subscribers get complete articles, exclusive industry analysis, and early access to legislative updates that keep you ahead of the competition. Join the professionals who are choosing deeper insights over surface level news.
