Yesterday I tried my first “Frictionless” stablecoin conversion. 

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Vite Exchange (ViteX Referral: 3186597827) is a little known DEX that has extremely low trading fees and offers high rewards to its members. It’s semi-open listing policy allows access to some hard-to-find tokens, and it’s near instant settlement with its DAG based ledger allows for it to scale on a level similar (or better) than Loopring’s L2 DEX (which I love as well).

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As with every young DEX, adoption is everything, and volume continues to be ViteX’s nemesis. In order to attract new users, they’ve rolled out zero-fee conversions between several stablecoins: USDC/USDT, DAI/USDT, BUSD/USDT.

If you’ve been in the crypto space for any amount of time, you’d know about the purpose and use of stablecoins. Essentially, it’s a safe place to hold your value during moments of volatility as they are pinned to the US dollar or other fiat currency. Stablecoins also dominate the top trading pairs on most exchanges as the vast majority of traders are most interested in their gains as measured by USD.

Stablecoins also can interact with smart contracts.

Everyone seems to have their own stablecoin these days; Bitfinex (USDT), Coinbase (USDC), and Binance (BUSD), are probably the most widely recognized ones, taking up respective crypto market cap positions of 3, 13, and 40 at the time of writing.

TUSD is a semi-centralized stablecoin solution at rank 35.

DAI, the most decentralized stablecoin currently available, is ranked 23 top crypto.

However, though they are all pegged to the same USD, you can’t use them everywhere for anything. Centralized exchanges want their stablecoin to be the most widely used, and so they generally avoid supporting other stablecoins as much as possible (with regard to client demand).

Binance is probably the most flexible exchange in terms of swapping stablecoins, but for those trying to stay off centralized exchanges as much as possible--especially Binance--and avoid fees particularly at higher volumes (as often the purpose of stablecoins is to scalp or leverage/margin trade large amounts over a smaller spread), the frequent fee and “minor” spreads in the trading books accumulate when swapping one USD to another USD. It adds up and can destroy profits.

Especially when operating only with decentralized exchanges, the opportunities of arbitrage become premised on liquid trading pairs, usually only available to one particular stablecoin. For those of you who don’t understand what I mean, imagine a great opportunity to buy UNI at 3 USD with DAI on uniswap, and sell it for 5 USD on Binance...but you only have USDC.

Even in terms of stablecoin yield farming, which has grown preposterously popular, you often must enter first with one stablecoin through a centralized exchange, and frequently, swap that out for another in order to use it on a yield farming platform. Or, in pursuit of the highest yields, you may want to swap from one pool to another which requires a conversion of your stablecoin.

This simple swap can cost you weeks to months of your APY, and as we all know, months in crypto is a long time.

In a purely practical scenario?

• I was telling a friend how it was “easy” to earn APY in the range of 5-10% using stablecoins and DeFi, and they asked me to set them up. I said (with all the necessary warnings), “sure,” because in terms of financial stability and crypto, stablecoins are the way to go. But when I actually deep dove into research, I realized it would be negated by the transaction and trading fees just to get their USD to a supported stablecoin. The net loss would have taken them at least half a year to break even, even with extra token farming benefits.
  
  I did it anyway, comping them them transaction fees, and the trading fees once, twice, three times? Really? And then contract approval, contract deposit, another contract approval? Withdraw fee was what??? 50 dollars?  Damn...I can't tell them about that.  Hopefully they don't ask me to do it again!

With flat fees across the board, Defi is great...if you’re already rich; it’s a game only available to those who can afford to bet big. I’ve no doubt this will change in time, as more low-fee or fee-less contract platforms emerge with Defi opportunities, but for now…

Enter ViteX.

They’ve removed all fees, and they’ve pinned every stablecoin they offer exactly to market value. No more artificial slippage, and most frequently, exact 1:1 trades.

(Yes, you will still have to pay the gas fees on ETH to move onto the platform and off it, and stablecoins themselves can fluctuate off their peg a little, but aside from that, you can remove a huge percent of your transactional losses just by using Vite’s exchange.)

It really is rather simple. After you have an account (ViteX Referral: 3186597827 if you want to support this article), deposit to the asset’s address: USDT/USDC/DAI/BUSD, and then move your funds to the exchange wallet.

Then go to the stablecoin trading pairs that say “free” next to them, and do a normal trade of whatever value you need with full knowledge that you’ll have 0 slippage and 0 trading fees.

Fuck up?  Wrong pair? Do it again. No worries.

It's amazing. 1:1 trades, at whim.

The cost of doing it on any other decentralized platform like Uniswap would cost you the smart contract gas fees of the 8-50 USD range, whereas doing it this way, you’ll only pay the combined 2-10 USD to move your funds on and off Vitex as a mere transfer of funds transaction.

This is the CHEAPEST way to convert stablecoin to stablecoin.

Rather do it on a centralized exchange, you say? With higher volumes, you’ll see that transaction cost, 15-50 USD at volumes of 10k. This is assuming 0 slippage, which could easily put you more in the 40-200 range on top of that.

And then the extra withdrawal fee, which is either the same or more than the gas cost of withdrawal.

Even the famed Coinbase Pro free withdraws policy was recently removed.

So, unless you’re trading super low volumes of stablecoins, the best solution I’ve found is ViteX.

(I’m probably preaching to the choir here. For those of you who know the pains of trading stablecoin to stablecoin, seeing your value tumble with each trade of what should be considered the same asset, it can be painful to watch.)

I think that this is, practically, one of the “hidden gems” of crypto, especially for the world of Defi.  What do you think? Have you found a better solution? If so, let me know in the comments.