What is a token swap?¶

A token swap is an exchange of one digital asset for another, usually through an exchange, wallet service or decentralised protocol.

Avoid the dangerous assumption¶

The dangerous assumption is that the original funds disappear when the user receives a different token.

The swap changes the form of the value. It may also alter the quantity, network and transaction route that the investigator must follow.

It may occur inside a custodial exchange without a separate blockchain transaction for each customer.

It may also occur on-chain through a smart contract or decentralised exchange.

Relevant records may include the asset sold, asset received, amounts, exchange rate, fee, transaction hash, contract address, account ID and timestamps.

On-chain swaps can involve several contract interactions and intermediary tokens.

The displayed result in a wallet may simplify that underlying sequence.

Preserve the exact token contract addresses and network, not only the displayed symbols.

Different tokens may share similar names or symbols.

Do not compare quantities directly without considering exchange rate, decimals and market value at the relevant time.

A swap can complicate tracing because the investigator must follow the new asset rather than search only for the original one.

It does not automatically indicate concealment.

Trading, portfolio management and access to services are common legitimate explanations.

Look at timing, repeated conversion, communications, source of funds and onward movement.

When reporting, distinguish the transaction mechanics from any inference about purpose or knowledge.

Operational takeaway¶

Treat a token swap as a conversion of traceable value and continue the investigation through the received asset, network, contract and onward transactions.