Fusion mode

Fusion is available in simple mode, and users are set to it by default. It doesn't require any gas fees for the user to execute a swap (outside of fast mode), as the taker, aka the resolver, pays for all related transaction costs. Each order is filled within a specific price range, starting from high to low (Dutch auction), designed to incentivize resolvers to take orders. This revolutionizes the execution of swaps on decentralized exchanges. Fusion mode also provides native front-running protection, as the resolvers, who fill orders, bundle transactions before sending them to the mempool. The RPC in your wallet does not determine the RPC through which the fusion transaction will be sent.

Classic mode

This is the original 1inch aggregation protocol. With Classic mode, users must pay gas fees for every swap, however, they can execute the transaction almost immediately and at (or near) the quoted rate.

In a typical Dutch auction, the price of an item starts high and is progressively lowered until a bidder accepts the current price, thereby winning the auction. With 1inch Fusion Dutch auctions, the exchange rate for an asset swap order starts high and gradually decreases until a resolver accepts the rate and executes the swap.

The key benefit here is that your order has a good chance of being filled swiftly, as multiple resolvers are motivated to complete the swap before the rate drops too low. This mechanism creates a delicate balance between the interests of both the user seeking a favorable swap rate and the resolvers looking for profitable opportunities.

Each swap has a specific time window during which a resolver can take a trade. The longer the swap window, the higher the chance that a resolver will take the order. If a resolver did not take your trade within the allotted time for your order, it will expire, and you will have to resubmit it.

This is the minimum amount you are guaranteed to receive for your trade, based on current market rates.

Holding 1INCH tokens will give you Unicorn Power. This power can be delegated to resolvers in order to receive token rewards from both the resolver incentive programs (farms) and to 1inch DAO participants. You can also Unicorn Power use for resolving, delegation, and governance.
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A note on APYs: When you select a resolver to delegate to, you will see a quoted APY next to each individual farm. This APY represents the average rewards distributed throughout the life of each resolver's farming or incentive program. This APY is quoted in percentage terms and is distributed in the form of tokens. Each resolver has a different APY, and therefore, each of the resolver farms is competing for the delegation power of stakers.

When you stake 1INCH tokens, you choose a lock period—anywhere from 1 month to 2 years. The longer you lock your tokens, the more Unicorn Power you get at the start, which boosts your influence and potential rewards.

If you decide to unstake your tokens before the lock period ends, a penalty in 1INCH tokens will apply. This penalty gets smaller over time—so the longer you keep your tokens staked, the less you’ll lose if you exit early.

However, the increase in power is not linear:

For those who want to withdraw their stake, they must wait until the initial token penalty threshold has passed.

With the introduction of 1inch Fusion mode, the previous stake reward program was deprecated, and now only resolvers are eligible to receive rewards for gas fees paid to resolve or take 1inch Fusion swaps. Since the resolvers pay Fusion mode gas fees, there would be nothing to refund to users who create the swap.

For Delegating, there are two different pods: resolving and governance. A minimum of 100% of the Unicorn Power that is acquired from staking 1inch can be delegated to either pod (but not both). The Unicorn Power decay rate is then transferred to the delegate and is kept separate from their pre-existing rate.

For example, if the delegatee has 2 years left in their lock period, and the delegator has 3 years, once the delegation is complete, the delegatee would have a 5-year decay period applied to the total amount of power held.

With resolving pods, delegators can choose which resolver to delegate to, based on the reward structure they prefer.

Generally speaking, transactions can be front-run, also known as a "Sandwich attacked," between the time they are submitted to the mempool and the time the block is added to the chain.

All 1inch Fusion swaps are matched directly with resolvers (takers) and are subsequently bundled with other orders before being included in the block on-chain. Since a Fusion swap is combined with other transactions, this eliminates the risk of your swap being front-run.

1inch resolvers are top holders of st1INCH tokens, who are designated to fill the orders of 1inch swappers. Resolvers fall within the top 10 balances of Unicorn Power and can be exclusively registered to fill orders.
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​Only approved resolvers have the chance of earning fees for filling users’ orders.

To become a resolver, you need a balance of staked 1INCH (st1INCH) tokens, meeting the minimum requirement of 5% of the total supply of Unicorn Power (UP). The maximum limit of listed resolvers is 10. Holding st1INCH tokens grants users UP, which can be utilized for farming programs or various activities. The duration of the token lock, ranging from 1 month to 2 years, directly correlates to the voting power gained as a resolver.

The top 10 resolvers have the privilege of filling Fusion swaps. Earning a spot on this list requires staking a sufficient amount of 1INCH tokens to acquire the necessary UP for a top 10 ranking. Resolvers can either stake tokens individually or attract users who delegate voting power in return for farming rewards.

Follow these steps to begin resolving:

To uphold the integrity of the 1inch Fusion mode, a smart contract-enforced maximum gas fee rule is in place. This cap on priority gas fees prevents any attempt to bypass the limit, including direct payments to a block builder’s coinbase. Violations will incur penalties.

Priority gas fee caps are determined by the baseFee:

Violators of the gas fee cap will face the following penalties:

Have further questions? Feel free to reach out to us in the live support chat!