One of the most common instances that require smart contract approvals is swapping.
The downside of infinite token allowances is it presents an opportunity to exploit users. If a user gives infinite approval to a smart contract address in a DeFi application and if that smart contract gets exploited or some bad actor somehow gains control of the address, they can sweep the specific tokens from any wallet that gave permission to spend their tokens.
How to Revoke Token Allowances
In light of the risks using unlimited / token allowances, it is a best practice among DeFi and Ethereum users to review token allowances a few times a year and edit/revoke any infinite allowances back to 0. It stems from an ethos among the crypto community “Don’t trust. Verify.”
How to Revoke Unlimited allowances for Zapper
Here’s how to approach this best practice of revoking unlimited allowances right on your
Zapper dashboard:
- Click on Settings in the left menu -> Manage under Allowances
- Look for any highlighted UNLIMITED allowances and then click the green Revoke button one at a time
- Each Revoke transaction will set the spending limit for that smart contract address back to 0, protecting your wallet and tokens
- One might also choose to Revoke higher allowances even if it’s not “unlimited”
- Be sure to repeat this process for each of your wallets