When it comes to trading ETH and ERC20 tokens, ForkDelta is one of the more popular decentralized exchanges out there today. However, it also has the reputation as being one of the least beginner friendly options, hence the creation of this guide. Just like the previous guide on AirSwap (a far more beginner friendly option), this guide will cover what ForkDelta is and how to use it.
EtherDelta and ForkDelta: A Brief History
Before we go into the guide, it is worth explaining a little bit about the difference between ForkDelta and EtherDelta as it can be confusing to those unfamiliar with their history.
ForkDelta is an open source fork of EtherDelta that still uses the same smart contract but different frontend interface. Essentially the backend is exactly the same (and not just a duplicate, it is literally the same smart contract) while the outside is slightly different.
So why does ForkDelta exist? In December 2017, hackers managed to compromise EtherDelta’s DNS server and serve its users a phishing site instead. At least 308 ETH was stolen as a result of the hack. Around the same time as the hack, there were strong suspicions that the original creators of EtherDelta had sold the site. The new owners immediately embarked on an ICO at the end of 2017, which raised numerous red flags from the community, such as its whitepaper missing key elements.
Needless to say, the ICO was a failure and it reached only 3% of its hardcap. The EtherDelta token, as you can see here, is now practically worthless. All of these caused members of the EtherDelta community to lose faith in the platform, with many worrying that the security of their funds had been compromised. Hence, a few of them decided to take matters into their own hands. Thus, in February 2018, ForkDelta was created. You can create about its initial announcement on this Reddit thread.
Since the creation of ForkDelta, EtherDelta is essentially dead and is considered inactive. ForkDelta, on the other hand, has picked up where the (old) EtherDelta left off and continues to thrive. As a final note, while ForkDelta and EtherDelta both use the same smart contract, the new owners of EtherDelta cannot alter said smart contract hence there is no worries about interference in that respect. It is trustless, much like Ethereum itself.
What is ForkDelta and What Makes It So Popular?
Similar to AirSwap, ForkDelta is a decentralized exchange that allows you to trade ETH and other ERC20 tokens. While its trading volume isn’t particularly high, its popularity stems from it being the first access points for listing of ERC tokens post-ICO (this was the case for EtherDelta too prior to the fork). As a result, ForkDelta has probably the highest number of ERC20 tokens listed; well over 200.
How to Use ForkDelta: Setting Up an Account
Now we come to the meat and potatoes of this guide, which is how to setup an account on ForkDelta and use it buy and sell ERC20 tokens. The first thing to know is the prerequisites to use ForkDelta.
Let’s start with the set up. Once you go head over to the ForkDelta page, you can choose to create a new account, import an account, connect your MetaMask wallet (which I will be using for this guide), or connect your Ledger Nano S hardware wallet. These options can be found at the top right corner of the page.
If you decide to create a new account, a new Ethereum wallet will automatically be created for you. The site will then give you your wallet address as well as your private key, which is essentially the ‘password’ for your wallet. You should always keep this as secure as possible as if someone knows your wallet address and its private key, he or she can access all the funds in the wallet.
Of course, I’m not actually going to use this account with a private key so visible. MetaMask is the most recommended option for using ForkDelta, so I will be using that instead. If you have an existing Ethereum wallet that you prefer, you can also use that using the ‘Import Account’ feature. Fortunately, ForkDelta makes it easy for you to delete any created account, as I show below.
Once you unlock (sign in) to your MetaMask wallet and go to the ForkDelta site, it will automatically log you in using your MetaMask account.
Finding Tokens to Trade on ForkDelta
There are two options you can choose from to select tokens you want to buy or sell. The first is using the ‘DAI’ menu at the top left of the screen.
The second option is to use the ‘Volume’ box at the bottom left of the screen. This might be an easier option because it will also display some basic information about the token such as its bid/ask price (quoted in ETH) and daily trading volume.
Understanding the ForkDelta Order Book
For the purposes of this guide, the ERC20 token I will be buying and selling will be PowerLedger (POWR). Once you select a particular token from the list, you will see the interface automatically update to reflect details about the chosen token.
First, let’s understand how to read the order book. ForkDelta uses a publicly available order book which anyone can view. Again, this is in contrast to AirSwap which uses a direct peer-to-peer matching system. The order book consists of traders who have already posted buy and sell orders and are waiting for them to be filled.
The first column shows the price per ETH for the POWR token. Red colours denote sell orders and Green colours denote buy orders. The second column shows the amount of POWR available for sale/to buy and the third column shows the equivalent in ETH. The order book is arranged from highest to lowest priced.
Keep in mind that if I want to buy POWR, I will have to fulfill one of the sell orders and vice versa. There is also the option of creating your own order to add to the order book, however because ForkDelta does not do automatic order matching, you will have to wait for a counterparty to decide to fulfill your order. Hence if it’s speed you want, it’s best to choose to fulfill an order from the order book instead.
Buying and Selling ERC20 Tokens on ForkDelta
Unlike AirSwap, which allows you to use your MetaMask wallet to directly trade ERC20 tokens, ForkDelta imposes on extra layer, funding the underlying smart contract. To do this, you will have to use the ‘Balance’ box in the top left of the screen. Here I’m depositing 0.02ETH from my MetaMask wallet into the ForkDelta smart contract. If I had other ERC20 tokens in my wallet, I could opt to deposit them as well.
This will bring up a MetaMask notification asking you to confirm said deposit.
Note that the gas price was actually set a little high. You can go to ETH Gas Station to check the standard gas price and the safe low gas price. Once you click submit the following notification pops up which also gives you transaction hash ID that you can check on Etherscan.
You can now see in the ‘Balances’ box that 0.02 ETH is now in the ForkDelta smart contract and my wallet has been reduced by the corresponding amount.
Now, I’m going to select a sell order to fulfill from the order book. Keep in mind that you do not have to fulfill an entire order amount; partial fulfillment is also possible. To show that, I will select a sell order that costs more ETH than I actually have in the ForkDelta smart contract.
Once you click on the relevant sell order the below popup will appear and you can adjust the amount of POWR you want to buy. From there, MetaMask will prompt you to confirm the order, similar to the process of depositing tokens above. Finally, ForkDelta will provide you with the transaction hash ID and the link to Etherscan.
Now you can see that my ‘Balance’ box shows my new balances with less ETH and my 30 POWR tokens. You can also see the trade I just did in the ‘Trades’ box on the top right of the screen.
Now let’s sell some of the POWR tokens back on ForkDelta. In this case, I’m going to choose the highest priced buy order. Coincidentally, this time I am able to fulfill the entire order.
Once again, I had to confirm the transaction on MetaMask and I was given the Etherscan link with the transaction hash ID. Once again, my balance is updated and the completed trade is shown in the ‘Trades’ box. Note that you can also see all of your recent trades in the ‘My Transactions’ box.
And that’s pretty much all there is to it when it comes to buying and selling tokens on ForkDelta. While it is not as convenient as AirSwap, it’s not overly complicated either.
IMPORTANT: Always check the market price before selecting an order!
At the time of this writing, one POWR trades at about 0.00045 ETH and you would expect that most orders would fluctuate around this value. And while most of them do, here’s what we find when we look at the highest priced sell orders on the order book.
That’s right, some people are setting prices at one POWR to 196 ETH! That’s over 400,000 times more expensive than the current market rate. Clearly, these are people just looking for newbies who may not know how to read the order book or didn’t even bother to check the market price beforehand. So make sure you don’t fall for one of these absurdly priced orders. You can find such ridiculous prices at the bottom end of the buy order book as well.
Placing Your Own Order on ForkDelta
If for some reason you cannot find anything on the order book that satisfies you, you can always place your own order. In the ‘New Order’ box, enter the relevant details; in this case I am going to place a buy order for 10 POWR.
You will then have to sign the transaction on MetaMask.
My order is now listed on the order book, and is highlighted in light blue.
What if you misquoted the order or simply don’t want to wait around for someone to fulfil it? Well, you can always cancel it from the ‘Orders’ tab in the ‘My Transactions’ box. You’ll need to sign the transaction on MetaMask and it will also be reflected on Etherscan. This means that cancelling an order will cost you gas fees.
Are There Any Fees for Using ForkDelta?
Other than the gas prices, which are applicable for all transactions on the Ethereum network, ForkDelta also charges a 0.3% fee upon execution of orders. This fee is specified as per the underlying smart contract and thus the fees actually go to the EtherDelta team. As per ForkDelta’s FAQ, they hope to change this in the future but have to balance this out with maintaining sufficient volume on the exchange.
Withdrawing and Transferring Your Tokens from ForkDelta
It is not recommended to leave funds on the exchange, so when you’re done trading, the best course of action is to withdraw the funds back to your Ethereum wallet. The difference between withdrawing and transferring is that withdrawals can only be done to whichever wallet is connected to ForkDelta (my MetaMask) in this case, while transfers can be done to any Ethereum wallet.
Let’s do withdrawals first. I’m going to withdraw my POWR tokens into my MetaMask wallet. Again you’ll have to confirm with MetaMask and you’ll see the usual transaction hash ID.
To show the transfer process, I’m going to transfer my remaining ETH into my CoolWallet S instead. Just use the ‘Transfer’ tab and put in the amount and address. Confirm it on MetaMask and that’s it.
Conclusion: ForkDelta Has a Massive Amount of Tokens, a Supportive Team, and Isn’t as Hard to Use as People Think
As you can see from this guide, ForkDelta isn’t as difficult as it’s made out to be. While the interface can seem intimidating at first, with a little know how (such as through this guide), you will be able to seamlessly navigate through it in no time at all.
Further, due to its history as a project of the community, ForkDelta has a dedicated team behind it that has all the right motives. Combine this with the huge amount of tokens available and it seems highly likely that ForkDelta will only keep growing from strength to strength.
Ian Lee is a freelance writer specializing in the areas of finance and all things crypto. He also has over five years of experience in investment banking. Follow him at http://ianlee.me/.