A token swap differs from a traditional cryptocurrency trade in several key ways. While a standard trade involves buying or selling a token on an exchange (centralized or decentralized) at market-determined prices, a token swap typically refers to the direct exchange of one cryptocurrency for another, often without an order book. In decentralized finance (DeFi), token swaps occur via automated market makers (AMMs) like Uniswap or PancakeSwap, where liquidity pools facilitate instant exchanges at algorithmically derived rates. Unlike traditional trades, token swaps do not require matching buyers and sellers; instead, smart contracts execute the swap based on predefined liquidity rules. Additionally, token swaps can involve cross-chain exchanges (e.g., converting Ethereum-based tokens to Binance Smart Chain tokens) through bridges or atomic swaps, which traditional trades usually do not support. Another distinction is that token swaps are often used for protocol upgrades, where old tokens are exchanged for new ones at a fixed ratio, whereas traditional trades focus purely on speculative or investment purposes. Finally, token swaps in DeFi may involve higher slippage and gas fees compared to limit orders on centralized exchanges, but they offer greater decentralization and direct peer-to-peer transactions.