Many wallets offer their users to swap crypto within the app. It is convenient for users because there is no need to look for a reliable exchange platform to send funds and process swaps there. In most cases, it is also cheaper for users because they don’t need to pay the fee charged by blockchain networks for transactions between wallet and exchange and by the exchange platform itself.
Usually, the swap functionality is provided not by the wallet but by a company that offers crypto processing.
And until now, many wallets limit themselves by collaborating with one such company only. There are better options than this. Collaboration with several companies – exchange transaction processors can bring a wallet numerous benefits. But first, let's look at why having only one processing provider is a threat to business.
Preventing Monopoly
The monopoly of an exchange provider is one of the major problems a wallet faces. It happens because if a wallet uses one exchange provider only, the latter can abuse this position in various ways.
Exchange rate manipulation
A monopolist doesn’t care about providing your users with profitable exchange rates. And indeed, why shall he? Your users don’t have many options to choose from: they either accept the rates in your wallet or move their funds to an exchange platform to swap them. And once they change your wallet for another exchange, are you sure they will come back?
Stability is endangered
If the monopolist faces any problems, you will also have to deal with them. Why? Because you won’t have any other options to offer to your users.
The number of coins is limited
The majority of exchange providers offer only a limited number of coins, those that are the most popular. If your user needs to exchange a rarer currency, he won’t be able to do it directly in the wallet.
User retention is low
All these factors negatively impact user retention rates. Additionally, the exchange provider may request you to provide user data, it is something your users may not like. Thus, the retention rate will drop even more.
That’s why it is better to collaborate with more than one exchange provider to ensure your users continue using your wallet.
How to Choose the Right Exchange Provider for Your Wallet
So, you already know that the more exchange providers you collaborate with, the better it is. But how can you select the best options for your users?
There are several factors to pay attention to.
The number of coins for swapping
The more coins are offered, the better it is. It will enable your users to swap not only common assets but also exchange rarer cryptocurrencies. In this regard, LetsExchange is among the leaders in the market, with the support of over 4,000 cryptocurrencies.
Exchange rate
If a provider knows that there is competition, it will charge fewer fees and look for opportunities to offer the best exchange rates. LetsExchange uses proprietary SmartRate technology to pick the best rates, and thus, your users can count on the most profitable swaps.
Liquidity level
Liquidity is essential to make swaps efficiently. That’s why it is vital to select those providers that can guarantee the required liquidity levels. LetsExchange uses its own liquidity and aggregates liquidity from multiple providers to ensure fast and effortless swaps even if your users exchange considerable sums.
Ease of integration
Integration shall be as easy as it is possible. So, if you integrate the API provided by LetsExchange, and if you already have a swapping function, all you need to do is to add it to the existing scheme. If the swapping function is not available yet, you need to create the exchange flow and integrate it from a zero point, but it is much simpler than integration with a traditional exchange.
Some More Points to Consider
Along with the mentioned details, consider such additional benefits as marketing support, the flexibility of income distribution from swaps made by your users, and customer support. In the case of LetsExchange, all these details are considered, and the team is ready to discuss everything in each individual case.
Conclusion
Offering your users an opportunity to swap their coins within the wallet is a great decision. But don’t limit yourself to one exchange provider only. The benefits of integrating several services are evident, and it doesn’t take a lot of time.