1inch Labs Turbocharges DeFi Routing with Pathfinder Algorithm Upgrade
1inch just dropped a bombshell—Pathfinder''s new version slices through liquidity pools like a hot knife. No more meandering swaps; this thing finds the optimal route faster than a trader chasing APY.
Under the hood: The algorithm now crunches more variables—gas fees, slippage, even MEV risks—while still delivering those sweet, sweet price optimizations. Eat your heart out, legacy finance routers.
Closing thought: If Wall Street spent half as much effort optimizing trades as 1inch does, maybe their ''best execution'' promises wouldn''t smell like 2008 vintage.
Table comparing rates for the old, new version of Pathfinder and peers. Source: 1inch Labs.
“The new Pathfinder enables users and integrators to maximize the value of every trade, offering up to 6.5% better swap rates and cutting gas costs even further. This upgrade sets a new standard and drives the industry towards true adoption, improving the experience for all,” said co-founder Sergey Kunz.
The new version of the algorithm allows to:
- maximize revenue: provides better rates by using multiple paths to swap, increasing the value of each transaction;
- improve liquidity efficiency: the algorithm breaks down volume and mixes routes. It uses pools more efficiently, extracting volume from concentrated liquidity for the most optimal swaps;
- provide better access to liquidity: the algorithm provides deeper access to a variety of liquidity pools and allocates volume to get the best rates where it matters most;
- make the most efficient use of gas: route pooling allows for optimal gas spending on each swap.
Mechanism of the new algorithm
As an example, 1inch gave a USDC swap for an APE token. In the case of the old version of the algorithm, this process WOULD look like this:
In this case, the project team explained, it would not be possible to use the same market for both paths, resulting in higher gas costs. This problem could be solved by merging the routes, which can be seen in the diagram below:
By eliminating unnecessary steps, the new version of the algorithm reduces gas consumption and optimizes routes by selecting the most optimal market for the swap.
At 1inch, they believe that more economical swaps are needed to drive greater adoption of crypto assets. The new version of Pathfinder accomplishes just that.
The updated algorithm is now available in the 1inch dApp and through APIs on the 1inch Developer Portal, providing improved routing efficiency, faster transaction speeds, and enhanced developer integration capabilities.
Notably, in May 2025, 1inch’s market share among other aggregators jumped to 63%, swaps jumped to 80%, and users jumped to 59%, according to OurNetwork. At the same time, daily trading volume on the platform reached $4.7 billion on May 21, renewing an all-time high.
Сообщение 1inch Labs introduced a new version of the Pathfinder algorithm появились сначала на INCRYPTED.
