Why Is a Two-Step Approve and Transferfrom Process Often Cheaper in the Long Run for Frequent Interactions?

While the initial setup requires two transactions ( approve and the first action), every subsequent interaction with the smart contract only requires one transaction (the action itself). If a user only approved the exact amount for each trade, they would need to submit a new approve transaction before every single trade.

For a frequent trader, the single, upfront approve transaction for a larger amount eliminates dozens of future approve transactions, saving a significant amount on gas fees over time.