How Routing Works
PananaSwap determines how a swap is executed by selecting an appropriate on-chain routing path based on the selected network, token pair, and current liquidity conditions.
Routing logic is designed to prioritize reliable execution, transparent fee application, and compatibility with the PananaSwap VIP system.
Routing Principles
PananaSwap routing follows a set of core principles:
Execution occurs entirely on-chain
Liquidity is sourced from supported protocols on each network
Routing decisions are deterministic and rule-based
Fees are applied according to the wallet’s VIP level
No off-chain price guarantees are provided
The routing system does not custody funds or alter execution outcomes beyond the defined logic.
Single-Chain Routing
All swaps on PananaSwap are executed within a single blockchain network.
Routing behavior includes:
Selecting compatible liquidity pools for the token pair
Determining the execution path supported by the network
Executing the swap via smart contracts
Settling output tokens directly to the user’s wallet
PananaSwap does not bridge assets across chains as part of routing.
Liquidity Sources
Routing relies on existing on-chain liquidity available on each supported network.
Key characteristics:
Liquidity sources may differ by chain
Pool availability affects execution paths
Routing may involve one or multiple pools
Insufficient liquidity may cause swaps to revert
PananaSwap does not create or manage liquidity pools.
Fee-Aware Routing
Routing logic incorporates PananaSwap’s fee framework:
Trading fees are applied at execution
VIP fee tiers are enforced automatically
Fee logic does not alter routing decisions
Fees are deterministic and transparent
Routing and fee application are handled as part of a single execution flow.
Execution and Slippage
Routing outcomes depend on real-time on-chain conditions.
Users define acceptable slippage tolerance
Transactions revert if execution exceeds tolerance
Market movement and liquidity depth impact results
Routing logic does not override user-defined slippage settings.
Limitations and Considerations
Routing behavior may be affected by:
Low liquidity or fragmented pools
Network congestion or gas constraints
Token-specific transfer behavior
Protocol-level restrictions
PananaSwap does not guarantee optimal pricing under all conditions.
Transparency and Verification
All routing executions are:
Performed by smart contracts
Recorded on-chain
Verifiable through transaction explorers
Users can independently review transaction paths and outcomes using public blockchain data.
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