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What Is Permit2?​

Permit2 is a token approval management contract introduced by Uniswap Labs. It serves as a universal standard for off-chain token approvals and works with any ERC-20 token, even those that do not natively support EIP-2612 permit() functionality.

In simple terms, Permit2 allows users to authorize token spending through a signed message (off-chain) rather than performing an on-chain approval transaction, reducing gas usage and improving the user experience.

General Workflow​

1. User Signs an Approval Message​

Instead of calling token.approve(spender, amount) on-chain, the user signs an EIP-712 structured message off-chain. This signed message contains the token, spender, amount, and expiration data.

This step is gas-free because it does not require an on-chain transaction.

2. The dApp Submits the Signature​

When the user executes a swap or similar transaction, the DApp includes the signed Permit2 message in the transaction request body, for example:

{
  "permit2Signature": "0x..."
}

The protocol then forwards the signature to the Permit2 contract during execution. Permit2 validates the signature and grants a temporary, scoped allowance for the transaction.

3. Token Transfer Occurs in One Transaction​

Permit2 validates the signature and transfers tokens atomically, meaning approval and transfer happen in a single transaction. There are no leftover approvals or permanent allowances unless explicitly configured.

Advantages of Permit2​

One-Time Approvals Across Protocols​

Users can approve a spender once and use that approval across multiple protocols that integrate Permit2. This eliminates repetitive approvals and additional approval transactions.

Enhanced Security​

Permit2 avoids the use of infinite token approvals and instead enables:

  • Expiring or limited-use approvals
  • Nonce-based control for replay protection
  • Scoped allowances per protocol or action

Gas Efficiency​

Approvals are handled off-chain via signatures, reducing gas costs and consolidating approval and swap into a single transaction.

Standardization​

Unlike older systems that rely on token-level support, Permit2 provides a universal interface that works with any ERC-20 token, making it a standard solution for modern DeFi protocols.

How Odos Uses Permit2​

Within the Odos Smart Order Router (SOR), if a token requires approval, Odos can include a permit2Message in the quote response.

Developers can then:

  1. Sign the message locally using the user's private key or wallet.
  2. Attach the resulting permit2Signature to the /sor/assemble request.
  3. Execute the swap in one transaction.

This eliminates the need for a separate approve() transaction and ensures that the swap executes efficiently and securely.