What decides whether a swap locks in a rate or keeps it floating

05 September 2026

The decision rests entirely on the swap type you choose: a fixed-rate swap locks the exchange rate at the moment you submit the transaction, while a floating-rate swap executes at the prevailing rate when the transaction confirms on the blockchain. The core difference is timing risk versus certainty.

How fixed-rate swaps work

When you select a fixed-rate swap on MilkshakeSwap, the exchanger reserves a specific rate for a short window - typically 15 to 30 seconds. It calculates that rate based on current pool conditions, then adds a spread to cover the risk that the market moves before the transaction lands. If your transaction confirms within that window, you get the quoted rate regardless of what happened to the token price in the meantime. If it takes longer, the swap fails and you must try again.

The exchanger bears the risk of price movement during the window. To compensate, the spread on a fixed-rate swap is generally wider than on a floating-rate swap. That wider spread is the price of certainty.

How floating-rate swaps work

A floating-rate swap does not reserve any rate. The exchanger quotes a current market rate, but the actual execution rate is whatever the decentralized exchange's liquidity pool offers at the moment your transaction is mined. The spread on a floating-rate swap is narrower because the exchanger takes no price risk - the market does.

The trade-off is obvious: you might get a better rate than quoted if the market moves in your favour before confirmation, or a worse one if it moves against you. In volatile conditions, that difference can be significant.

What decides which you get

The swap interface offers the choice directly. The decision is yours. There is no automatic selection between the two modes for a given trade. You see both options, with their respective quotes, and pick one.

When each makes sense

A fixed-rate swap suits you when you know exactly how much you want to receive and cannot tolerate slippage - for example, when swapping into a token for a specific payment or arbitrage opportunity. The wider spread is a known cost.

A floating-rate swap suits you when you want the lowest possible spread and can accept some uncertainty in the final amount. It works best for large or patient trades where the market is relatively calm.

Why the difference matters for costs

The choice directly affects where your money goes. On a fixed-rate swap, more of the spread goes to the exchanger as compensation for bearing price risk. On a floating-rate swap, more stays in the liquidity pool, and the spread is smaller. This is part of the broader picture of what a crypto swap actually costs, which the hub page explores in detail. Network fees remain the same regardless of which rate type you pick - they depend only on blockchain congestion and transaction complexity.

One more thing: failed swaps

A fixed-rate swap that fails because the rate window expired costs you nothing except the network fee. The exchanger does not charge for the attempt. A floating-rate swap cannot "fail" due to rate expiry, but it can fail if the pool lacks liquidity at the time of execution - and you still pay the network fee for that failed attempt.

Summary

The exchange rate locks when you choose a fixed-rate swap and the transaction confirms in time. It floats when you choose a floating-rate swap, settling at whatever the pool offers at confirmation. The spread you pay is the main difference. The choice is yours, and it is always presented before you confirm.

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