Mainnet swap refers to the shift of a cryptocurrency project from one blockchain network to another (which in most cases is its own native blockchain network).
What Is a Mainnet Swap?
Mainnet swap is the migration of a cryptocurrency project from a third-party blockchain network, such as Ethereum, to its native blockchain network. A third-party blockchain network is used when a cryptocurrency project is in its testnet phase. But once it moves from the testnet phase to the mainnet phase, users receive native cryptocurrency in exchange for their third-party tokens. That’s why it is also called token migration or token swap. At its core, the mainnet swap is the exchange of third-party tokens with the platform’s native cryptocurrency.
Better Understand Mainnet Swap
Since 2017, ELF has been held as an Ethereum based ERC-20 token. After spending considerable time testing the security and reliability of its platform, they announced the mainnet swap on September 9, 2021. Typically, the mainnet swap follows a 1:1 ratio. Once it is completed on the entire blockchain, the remaining tokens are burned. Another example of a mainnet swap is BNB (Binance Coin). When Binance Chain was in its testnet phase, it was using the Ethereum based ERC-20 BNB token. However, after the mainnet launch, ERC-20 BNB token holders were encouraged to migrate to the BEP2 BNB coin (the native coin of Binance). This swap occurred at a 1:1 ratio, meaning 1 BEP2 BNB coin equaled 1 ERC-20 BNB.
When Does Mainnet Swap Occur?
Typically, a mainnet swap occurs when a cryptocurrency project moves from one blockchain to another or migrates its tokens from a third-party blockchain to its native chain. However, the mainnet swap isn’t associated exclusively with new blockchains. A project may announce it if it decides to move from one protocol to another. One example would be the migration of tokens from Bitcoin-based protocol to Ethereum network.
When it comes to the specifics of a mainnet swap’s execution, it varies from project to project. The majority of projects give a deadline to users for the migration of tokens. Failing to do so means you will end up losing access to your tokens as they’re usually burned after the given deadline.
How Is the Swap Done?
Depending on the main features of execution, users can either manually swap their tokens or leave them to the platform. For example, Binance allowed users to leave their previously issued tokens on their accounts, so the platform could automatically swap their tokens with native tokens.