Key Takeaways
Intent-based transactions allow users to define a desired outcome rather than the specific steps to achieve it.
This model shifts the complexity of execution from the user to specialized third-party agents known as solvers or fillers.
Intent-based transactions can make your trading experience smoother, save some money on fees, and protect you from certain trading bots.
But there are some limitations, such as potential centralization risks and opacity regarding how intermediaries (solvers) execute the trades.
Introduction
In the early days of decentralized finance (DeFi), making a trade felt a bit like solving a puzzle. You had to figure out the gas fees, choose the right path for your trade, and hope the transaction didn't fail. If you made a mistake, you lost money.
Intent-based transactions were designed to fix this, making DeFi more accessible. Instead of giving you a box of tools and telling you to build the car, the system acts like a taxi driver: you just tell it where you want to go, and it handles the driving.
What Are Intents?
In DeFi, an intent is your goal. So, unlike a standard transaction that lists specific instructions (e.g., "Do A, then B, to get C"), an intent simply states the desired outcome (e.g., "I want X, and I am willing to pay Y”). Let's compare the newer intent model with the traditional method.
The traditional method: Imperative
This is the "Do It Yourself" approach. You have to give specific instructions to the blockchain.
Example: "Take my token, go to this specific pool, swap it, pay this much gas, and send the new token to my wallet."
Problem: If the gas fee changes or the pool is empty, your trade fails. You have to know exactly how the system works.
The newer method: Declarative Intent
This is the "Make It Happen" approach we described earlier. You focus on the result.
Example: "I have 1 ETH and I want at least 2,000 USDC. Make it happen."
Solution: You don't care which pool is used or how the gas is paid. You just want the final result to match your request.
How Do Intent-Based Systems Work?
In an intent-centric architecture, the transaction lifecycle changes significantly from the standard public mempool model.
User expression: The user signs a message (the intent) defining their specific goal, such as swapping Token A for Token B at a minimum price.
Outsourcing: This intent is broadcast to a network of third-party agents, often called solvers, searchers, or fillers.
Execution: Solvers compete to find the optimal execution path. They may aggregate liquidity from various sources, batch multiple orders, or use their own inventory to fulfill the request.
Settlement: The winning solver executes the transaction on-chain. In many designs, the solver pays the gas fees upfront and is reimbursed through the trade.
Benefits of Intent-Based Transactions
Improved user experience (UX)
Intents abstract away the technical complexities of DeFi. Users do not need to worry about gas spikes, failed transactions, or bridging assets across chains manually. For example, "gasless" trading is made possible because solvers can pay the network fees in the native coin (like ETH) while the user pays in the token they are swapping (like USDC).
MEV protection
In traditional trading, users are vulnerable to Maximal Extractable Value (MEV) attacks, such as front-running or sandwich attacks. Intent-based systems often protect users by delegating the execution risk to solvers. Since the trade is not finalized until the user's conditions are met, the solver is incentivized to protect the value of the trade.
Capital efficiency and better pricing
By outsourcing execution, users gain access to a competitive market of solvers who search for the best prices across both on-chain and off-chain liquidity sources. Solvers can also batch multiple transactions together (coincidence of wants), which improves efficiency and reduces the overall impact on the network.
Examples of DeFi Platforms With Intent-Based Transactions
Many DeFi protocols have adopted intent-based models to enhance their services:
CoW Protocol: Uses batch auctions to match trades and protect users from MEV.
UniswapX: Aggregates liquidity from various sources and offers gas-free swaps using a Dutch auction mechanism.
1inch Fusion: Allows users to place orders that are executed by professional resolvers who pay the gas fees.
Across Protocol: Uses intents for fast and cost-effective cross-chain bridging.
Risks and Challenges
While intents make life easier, there are a few things to watch out for:
Centralization risk: Right now, becoming a solver is hard work. If only a few big companies can do it, the system tends to become less decentralized.
Trust: You have to trust that the system of solvers is working fairly. Since some of the work happens off the main blockchain, it can be harder to see exactly what is happening compared to the old way.
Closing Thoughts
Intent-based transactions are trying to make DeFi as easy as using a regular banking app. By focusing on what you want rather than how to get it, the technology fades into the background. As this tech grows, we can expect smoother, cheaper, and safer trading for all levels of DeFi users.
Further Reading
Disclaimer: This content is presented to you on an “as is” basis for general information and educational purposes only, without representation or warranty of any kind. It should not be construed as financial, legal or other professional advice, nor is it intended to recommend the purchase of any specific product or service. You should seek your own advice from appropriate professional advisors. Products mentioned in this article may not be available in your region. Where the article is contributed by a third party contributor, please note that those views expressed belong to the third party contributor, and do not necessarily reflect those of Binance Academy. Please read our full disclaimer for further details. Digital asset prices can be volatile. The value of your investment may go down or up and you may not get back the amount invested. You are solely responsible for your investment decisions and Binance Academy is not liable for any losses you may incur. This material should not be construed as financial, legal or other professional advice. For more information, see our Terms of Use and Risk Warning.