Topic: Crypto Exchanges vs Instant Swaps (changelly, shapeshift) (Read 194 times)

Yes that is the biggest thing holding instant swaps back, their margins are currently much bigger but some exchanges rip people off by charging withdrawal fees and transactions fees

I don't think instant swaps already have the ability to totally replace exchanges.

Disregarding the talks about the fees, they are all the same for me in a sense that they can both change one crypto into another crypto but to be honest, exchanges still possess an edge over instant swaps and that is being able to support more coins/tokens. For this reason, exchanges are still much preferable to use.

No, those services will never replace exchanges. Traders won't use such services. Exchanges give you more control like choosing the price yourself. And exchanges usually have more coins and less fees. If you prefer to regularly revise your portfolio and exchange coins, then exchanges seem better. If you need just one time transaction, then go for Shapeshift or Changelly. Traders will never prefer instant services over regular exchanges. What can replace exchanges, however, is decentralized exchanges like EtherDelta.

Exchanges will not become irrelevant anytime soon.

Instant swap sites have 2-5% margin. They are good for small amounts or one-time deals. But it's impossible to use it for daily trading. You can't compare 2%-5% with exchanges commission of 0%-0.2%.

That was my thinking but only time will tell. As with usual if there is a demand for something in general it usually happens and in the process lowers the cost as competitors emerge and saturate the market.

Many cryptobank projects now working on instant exchange using utility token for crypto-crypto and crypto-fiat exchange
The most anticipated one is Crypterium
I think in the near future, exchange will be used like traditional stock/forex exchange to get profit (speculation), while cryptobank apps used for daily transaction

I agree that using Changelly or ShapeShift would mean you having the inconvenience of keeping wallets on your desktop when you would not have them if you put your coins on an exchange. The more they trade I am sure the rates will go down to stay competitive.

The big difference is the fees. Changelly uses exchanges to do the actual trade. So their margins are added on top of the exchange fees. That is why they charge around 0.5% for every trade.
Another disadvantage is that you may not want to take delivery of coins. I think that coin #300 is going to go up. If I use changelly, I actually have to download the wallet and hold the coins.

Yes you are right. It seems for those regular traders the TX fees of exchanges are important as it eats in to their profit but the margin is not always that big. With regular use and over time instant swap rates will get better.

Exchange sites would continue to remain relevant in the scheme of things as it relates to crypto based on the following reasons that I can think of now:

1. There would always be need for market place where the price is determined by the forces of demand and supply, by the people in the market as against the other option you mentioned. On exchange sites, I can set a target then go to sleep, the next morning if the forces tends towards that direction, I make money while sleeping otherwise I wait. Also, it accommodates the services Changelly are doing because you can sell instantly on exchange sites as well. Just use the current market price and see your orders filled.

2. On the issue of KYCs while this is an advantage that Changelly and co has, it won't last long because whether we like it or not, regulation is coming and those promoting its ineffectiveness would be doing more harm to the market. Its as well better to start getting accustomed with it now. Another issue is volatility that Changelly must have whether the coin is being traded at the moment or not which is more risky for them

3. The fees is another killing thing I have used Shapeshifts, and I blame myself from the below market price they quote, down to the fees they charge for their own service and the payment of network fees, exchange sites are way better.

They are both Exchanges, instant and not.

Not instant exchanges are definitely better for traders. As you have stated, users could store different coins in one account. In addition, they could sell or buy coins anytime and have the ability to choose the price they want. Instant Exchanges, on the other hand, are most likely for those who want to buy or sell instantly, no plan of storing the coins nor making several trades. Users have no power to choose the price, though. There's an estimation, but it's prior to change depending on the coin price during the time of transaction.

Currently they are effectively benefitting exchanges but when the time is right and their profits dictate, will they side step exchanges entirely?

Add blocktrades.us to the list as well. It is a decentralised service built on the bitshares platform and allows you to exchange coins without logging in.

It doesn't have as wide a selection of coins as shapeshift and the others, but I can recommend how efficient the service is.

Using instant Swaps like shapeshift or changelly for traders is a nuisance, every time you will trade using their service there is a minimum amount of coins for you to be able to use the quick swap, i remembered before i need a few amount of ETH for a purpose of GAS only but the minimum requirements is kinda BIG so what i did is i used an exchanger site to get the ETH that i need to use for GAS. If you are trading daily then it is better to use exchanges they get few % of interest only in every trade you do.

they have their own uses, instant swaps are good for simple relative-quick one time transaction
while regular exchanges was made mainly to accomodate trading all crypto currencies
instant swaps will you cost you more than regular exchanges because of network tx fees and profits for the service
regular traders would never use instant swaps for the reasons above

Decentralised is still some time away but the idea to fill the gap by instant exchanges is very good. Sure they are using exchanges but if they contiue to grow then exchanges will have no purpose for them and if not monopolised they will charge tiny fees.

Shapeshift and Changelly are using other exchanges. They do the instant exchange by connecting over API to other exchanges. They are no threat to exchanges.

The instant swap services are a step in the right direction, but cutting out the third party middlemen altogether is the ultimate goal.  

The original concept was a trustless transaction between two people without a custodian holding the funds in between.  That was the revalation.  And then what did we do?  We went straight back to the traditional banking model where we trust people we don't know to look after our money for us.  Then the exchanges lost that money, just like the banks do.  Stupid human nature, ever repeating the mistakes of the past.  So at least Changelly, Shapeshift, etc are an improvement on that.  But we can still do better.

The gateway between fiat and crypto is somewhat harder to bridge, so exchanges will survive because of that, plus the day-traders, who will find it a more convenient option.  But decentralised trade from one blockchain to another is rapidly approaching.  We won't need a service to do it.

I used Changelly.com the other day for the first time and it was excellent. It has a better exchange rates than Shapeshift.io and I did not like the Shapeshift reviews

Maybe the days of exchanges are numbered now that instant exchange is available rather than buy/sell walls on exchanges

Do you think exchanges might become irrelavant in the coming years? The only advantage they seem to have is that investors can send their crypto to their addresses instead of having multiple wallets on their own desktop. With Changelly and Shapeshift growing they are causing problems for exchanges and provide greater anonymity too with no AML/KYC required