Wallets, Security & Custody

What is an unlimited token allowance and why is it risky?

An unlimited token allowance is a token approval that lets a smart contract spend any amount of a token from your wallet, with no cap. It is risky because if that contract is malicious or later compromised, it can drain your entire balance of that token without further consent from you. For example, approving an unlimited allowance to a flawed exchange contract leaves your full holding exposed if the contract is exploited. Many apps request unlimited allowances for convenience, but granting a finite amount limits how much is ever at stake. Reviewing and tightening allowances reduces exposure.

Crypto investments are subject to market risk and volatility. Past performance is not indicative of future returns. This is general information, not investment advice — consider your own circumstances or consult a qualified adviser before investing.