Mainnet Swap

November 21, 2023 - Around 2 mins mins to read

Understanding Mainnet Swap

A Mainnet Swap is the process of transferring a cryptocurrency project from a third-party blockchain network, such as Ethereum, to its native blockchain network. During the testnet phase of a cryptocurrency project, a third-party blockchain network is used. However, once the project moves to the mainnet phase, users receive native cryptocurrency in exchange for their third-party tokens. This process is also referred to as token migration or token swap, as it involves exchanging third-party tokens for the platform’s native cryptocurrency.

Exploring Mainnet Swap in Detail

ELF, an ERC-20 token based on Ethereum, has been in circulation since 2017. After thoroughly testing the security and reliability of its platform, ELF announced the mainnet swap on September 9, 2021. Typically, a mainnet swap follows a 1:1 ratio, and once the swap is completed across the entire blockchain, any remaining tokens are burned.

Another example of a mainnet swap is BNB (Binance Coin). During the testnet phase of Binance Chain, the platform used the ERC-20 BNB token based on Ethereum. However, after the mainnet launch, ERC-20 BNB token holders were encouraged to migrate to the BEP2 BNB coin, which is the native coin of Binance. This swap occurred at a 1:1 ratio, meaning 1 BEP2 BNB coin was equivalent to 1 ERC-20 BNB token.

When Does a Mainnet Swap Occur?

A mainnet swap typically occurs when a cryptocurrency project transitions from one blockchain to another or migrates its tokens from a third-party blockchain to its native chain. However, it is not limited to new blockchains. Projects may also announce a mainnet swap if they decide to move from one protocol to another. For instance, tokens may be migrated from a Bitcoin-based protocol to the Ethereum network.

The execution specifics of a mainnet swap vary from project to project. In most cases, projects set a deadline for token migration. Failing to meet this deadline results in the loss of access to the tokens, as they are usually burned after the specified timeframe.

How Is the Swap Process Conducted?

The swap process can be carried out manually by users or left to the platform, depending on the execution features provided. For example, Binance allowed users to keep their existing tokens in their accounts, enabling the platform to automatically swap them with native tokens.