My 1inch profit booking trade, less profitable due to Ethereum Blockchain’s transaction fees!!

in hive-175254 •  9 months ago  (edited)

1inchbanner.jpg

With the Big Upside move of 1inch yesterday, it was time to book profits

Yesterday, I noticed this crazy price action of the 1inch tokens I hold and I felt it’s time to take profits. This is because that candle wick is too overstretched, meaning there will be investors now booking profits.

This is why today, the price of 1inch tokens experienced a decline from 7.7 dollars yesterday to 5$ dollars today.

1inchusd.png
https://www.tradingview.com/chart/jCWaxKNy/
Notice the over stretched green candle, it generally signifies a top. It's time to book some profits.

Swap trade of 1inch in the Ethereum Network proved to be too damn costly!!

The problem was I brought 1inch tokens when it was about 2 dollars on 1inch Ethereum Network. Yes, can be guessed right, the problem is the crazy Ethereum fees, nothing new but it was still staggering for me to contemplate the magnitude of the fees to pay for swapping my 1inch tokens. The swapping rate was showing as 93$.

I generally take partial profits, but that option got ruled out. I had 35.16 1inch tokens that amounted to around 214$ yesterday.

Imagine, if I book partial profits selling 16 1inch tokens worth 97$, then the fees I have to pay will cancel out almost all my proceeds from the swap.

So I decided to swap my entire 35.16 1inch tokens for ETH and hodl ETH for further future gains.

incheth.png
https://www.tradingview.com/chart/jCWaxKNy/
1inch managed to rise against ETH too...

1inch protocol discourages US traders from using its platform

Fortunately, the 1inch aggregator found a swap trade in Sushi swap that would cost 63$ in fees, so it’s at least cheaper than what I thought(90$!!), so I went ahead to do the swap.

Then I was told to check out and comply with 1inch’s terms and conditions. Here, that page told me to confirm that I was not a resident of the US, and I am not a US resident trader accessing 1inch using vpn. Ok, that’s unfair but it does not directly concern me, however, I wondered why the 1inch protocol is not implementing a similar policy for China’s resident traders?.

So it's ok if China's resident traders use vpn and trade in 1inch?...hmmm. Anyway, it does not concern me, although US and China crypto and DEFI enthusiasts have my sympathies!!

I assumed that 1inch has taken such a stance with the US resident traders, because of the prevailing regulatory uncertainty in the US with the US Securities Exchange Commission (SEC) inching to prosecute protocols declaring that they are trading illegally as unregistered securities. Pretty uncool of the US authority, the SEC but anyway.

Successful transaction with proper execution of the swap trade in the Ethereum Network!!

Finally, after complying with 1inch’s terms and conditions, I approved the 1inch swap to ETH that will be executed in Sushi Swap for 63$.

First time, it did not go saying the trading fees were changed. Thankfully, I verified no fees got deducted, as it happened for me once using Open Ocean protocol.

Second time my swap got executed, I sold all my 35.16 inch tokens for more ETH.

etherscan.jpg
Etherscan details of my 1inch swap for ETH

On paper I would have got 245% gains but in reality, I made a profit of just 51$ or so on my 1inch holdings!!

All this reminds me not to engage in any DEFI activities inside the Ethereum Network, but still despite those mighty Ethereum fees I managed to make a profit on my 1inch tokens I sold yesterday!!

Profits you make in reality is different from actual paper gains we made

DEFI in Ethereum is only worthwhile for large crypto hodlers who made super great profits to afford the fees in trading there.

My lesson is that profit in paper is not the reality, the reality is the actual profits you make after deduction of those transaction fees etc and in Ethereum, our paper profits amount to nothing, those profits will be gobbled up by the mighty fees for sure.

Thank you for reading!!

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hello @mintymile,
I'm glad you were able to make a profit, but on the ethereum network, making profits that can be capitalized is a real challenge. The large commissions charged by this network end up consuming almost everything we earn, and now with ethereum values it is more complicated to see profits in this network, other networks like cardano or Ada will end up displacing etherium from the cryptocurrency market.

Eth fees is very high most of the user are afraid to make a transaction in the eth network. If it is very urgent then only they will make a transaction otherwise they will avoid in the chain.

Hi @mintymile

Ethereum network transaction fees are one of the headaches of the whole Blockchain, I recently made an investment in a NFT game running on the Ethereum network, and the transactions are more expensive than the actual operation of the jeu itself.

Best regards, be well.