Currency swap refers to the exchange transaction between two currencies. Generally speaking, it refers to the exchange of capital and principal between two currencies. Swap transaction refers to a transaction in which both parties agree to exchange cash flows that are considered to have the same economic value in a certain period in the future. Swap trading, like futures and options trading, is a kind of financial derivatives and one of the important tools for international financial institutions to avoid exchange rate risk and interest rate risk. Common swap transactions include currency swap transactions and interest rate swap transactions. Among them, interest rate swap transaction refers to the swap transaction between different interest rates of the same monetary fund, which is generally not accompanied by the swap of principal.