Why do I need to give permission to a smart contract before exchanging cryptocurrency through 1inch/OKX?

The exchange process includes two stages:
1. Granting permission to a smart contract (occurs with the deduction of a small network commission).
2. Swapping one cryptocurrency for another (occurs with the deduction of a higher network commission).

Granting permission is a standard procedure for all decentralized exchanges such as Uniswap, PancakeSwap, CowSwap, 1inch, etc. It protects your wallet from unauthorized access by a smart contract without your consent.
Smart contracts cannot access your tokens unless you give them access. By granting such permission, you give the smart contract the liberty to spend your assets. The miners, in turn, receive a commission for recording this action on the blockchain which is paid by you (gas fee).

Here are the step-by-step instructions on what granting permission looks like in the Tangem application:

1. Open the Tangem app and log in to your wallet.
2. Select the cryptocurrency you want to exchange.
3. On the cryptocurrency’s page, tap Swap.
4. Enter the amount of tokens you want to exchange and select the currency you want to exchange them for.
5. Tap Give permission. A window will open, showing the fee for issuing a permit. You can also choose to issue a permit for the current transaction or unlimited. Then tap Approve and scan your wallet.
At this point, you have given permission but not completed the swap.
6. To exchange your crypto, Tap Swap, then scan your wallet to sign the transaction. Once the transaction is signed and sent to the blockchain, its data can be viewed in the browser.

Benefits of granting unlimited permission
If you have granted unlimited permission to a smart contract, you will not need to do this again for future transactions (only if you don’t revoke the permission).

Important points
• Permission is required for each individual smart contract.
• Swap permission will only be requested if you exchange a token that operates under smart contracts (for example, an ERC20 token). For native coins, such permission is not needed since they’re regulated by blockchain algorithms, not smart contracts.