Permits, approvals & spending caps

How Terminal 1 handles token authorization.

Terminal 1 must be authorized to move tokens on your behalf in order to execute a route. Depending on the token and workflow, this authorization is provided either through an onchain approval (ERC‑20 approve) or a Permit-based signature flow (e.g., EIP‑2612 / Permit2) that can be bundled into the route. Where supported, Terminal 1 uses bounded spending caps so the authorization is limited to the token(s) and maximum amount(s) required for the route, rather than granting an unbounded allowance.

Approvals vs permits

• Approval: an onchain transaction that sets an allowance for a spender contract.

• Permit: an offchain signature authorizing spend under specific parameters, typically executed onchain as part of the route.

Spending caps (scope)

Authorizations are scoped by token, spender, and maximum amount. If the cap is too low (because prices, fees, or buffers changed), execution will revert rather than over-spend.

EOA vs Safe

• EOA (atomic execution): permits and execution can often be bundled so the workflow completes with fewer distinct transactions.

• Safe mode (native Safe batch): approvals and permits can be included as explicit batch steps, making authorization and execution steps visible in the Safe interface prior to signing. This does not change what is authorized, only how the steps are presented and executed.

What to check before signing

Users should review:

• the token being authorized

• the maximum spend amount

• the spender being authorized