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What is Fusion Mode?

1inch Fusion Mode is a decentralized order execution protocol that uses Dutch auction mechanics to optimize token swap pricing. Unlike traditional AMM (Automated Market Maker) swaps that execute at a fixed price, Fusion Mode creates competitive auctions where multiple resolvers compete to fill your order at the best possible rate.

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How it works

1

Order creation

You create a swap order specifying the tokens you want to exchange and the amount. The SDK generates a signed order with auction parameters.
2

Dutch auction starts

Your order enters a Dutch auction where the acceptable price starts high (favorable to resolvers) and gradually decreases over time until it reaches your minimum acceptable rate.
3

Resolver competition

Professional resolvers monitor the auction and compete to fill your order. They execute when the price reaches their profitability threshold.
4

Settlement

The first resolver to successfully execute the swap at the current auction price wins. You receive your tokens at the best available rate.

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Key advantages

Better pricing

Dutch auctions naturally discover the best market price through resolver competition, often beating AMM rates

Gas efficiency

Resolvers handle the complexity of routing and execution, optimizing gas costs on your behalf

MEV protection

The auction mechanism and resolver competition help protect against MEV (Maximal Extractable Value) attacks

No slippage

You specify your minimum acceptable rate, and the auction ensures you never get less

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Fusion Mode vs traditional swaps

FeatureFusion ModeTraditional AMM
PricingCompetitive auctionFixed pool pricing
ExecutionOff-chain by resolversOn-chain
Gas costsOptimized by resolversPaid directly by user
MEV protectionBuilt-inVulnerable
SettlementSingle on-chain transactionMultiple hops possible

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The auction mechanism

Fusion Mode uses a Dutch auction (also called a descending price auction):
  1. Auction start: The price begins at a level favorable to resolvers (higher than market rate)
  2. Price decay: Over the auction duration (typically 60-180 seconds), the price gradually decreases
  3. Execution: The first resolver to execute at the current price wins the auction
  4. Price curve: You can customize the auction curve to control how quickly the price decreases
import { FusionSDK, NetworkEnum } from '@1inch/fusion-sdk'

const sdk = new FusionSDK({
  url: 'https://api.1inch.dev/fusion',
  network: NetworkEnum.ETHEREUM,
  authKey: 'your-api-key'
})

// Get a quote with auction details
const quote = await sdk.getQuote({
  fromTokenAddress: '0x6b175474e89094c44da98b954eedeac495271d0f', // DAI
  toTokenAddress: '0xc02aaa39b223fe8d0a0e5c4f27ead9083c756cc2',  // WETH
  amount: '1000000000000000000000' // 1000 DAI
})

// The quote includes auction start and end amounts
console.log('Auction start amount:', quote.presets[quote.recommendedPreset].auctionStartAmount)
console.log('Auction end amount:', quote.presets[quote.recommendedPreset].auctionEndAmount)

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Auction presets

The SDK provides three preset auction configurations:
Duration: ~60 secondsUse case: When you need quick execution and are willing to accept slightly less optimal pricingPrice curve: Steep decline for rapid settlement
You can also create custom presets with fully configurable auction parameters.

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Resolvers

Resolvers are the backbone of Fusion Mode. They are professional market makers and liquidity providers who:
  • Monitor auction orders in real-time
  • Calculate optimal execution strategies
  • Compete to fill orders at the best price
  • Handle routing across DEXs and liquidity sources
  • Pay gas costs for settlement
Resolvers earn profit from the spread between the auction price and the actual execution price they achieve. This creates a competitive market that benefits users.

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Security considerations

Fusion Mode is designed with security in mind:
  1. Signed orders: All orders are cryptographically signed, preventing unauthorized modifications
  2. Time limits: Orders have expiration timestamps to prevent stale executions
  3. Minimum rates: You specify the worst acceptable price, protecting against unfavorable fills
  4. Whitelist option: You can restrict which resolvers can execute your order (optional)

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Next steps

Auction mechanics

Deep dive into auction parameters and price curves

Order lifecycle

Understand how orders flow from creation to settlement

Placing orders

Learn how to create and submit Fusion orders

Custom presets

Configure advanced auction parameters

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