diff --git a/backend/canisters/user/CHANGELOG.md b/backend/canisters/user/CHANGELOG.md
index d154be64d8..afd8d2fecf 100644
--- a/backend/canisters/user/CHANGELOG.md
+++ b/backend/canisters/user/CHANGELOG.md
@@ -5,6 +5,10 @@ The format is based on [Keep a Changelog](https://keepachangelog.com/en/1.0.0/).
 
 ## [unreleased]
 
+### Changed
+
+- When swapping tokens take fee out of amount passed in ([#4934](https://github.com/open-chat-labs/open-chat/pull/4934))
+
 ## [[2.0.961](https://github.com/open-chat-labs/open-chat/releases/tag/v2.0.961-user)] - 2023-12-05
 
 ### Added
diff --git a/backend/canisters/user/impl/src/updates/swap_tokens.rs b/backend/canisters/user/impl/src/updates/swap_tokens.rs
index 628817f7d4..aa4e7edb90 100644
--- a/backend/canisters/user/impl/src/updates/swap_tokens.rs
+++ b/backend/canisters/user/impl/src/updates/swap_tokens.rs
@@ -64,7 +64,7 @@ pub(crate) async fn process_token_swap(mut token_swap: TokenSwap, attempt: u32)
                 fee: Some(args.input_token.fee.into()),
                 created_at_time: Some(now * NANOS_PER_MILLISECOND),
                 memo: Some(MEMO_SWAP.to_vec().into()),
-                amount: args.input_amount.into(),
+                amount: args.input_amount.saturating_sub(args.input_token.fee).into(),
             },
         )
         .await
@@ -85,7 +85,7 @@ pub(crate) async fn process_token_swap(mut token_swap: TokenSwap, attempt: u32)
             Err(msg) => {
                 mutate_state(|state| {
                     let now = state.env.now();
-                    token_swap.notified_dex_at = Some(Timestamped::new(Err(msg.clone()), now));
+                    token_swap.transfer = Some(Timestamped::new(Err(msg.clone()), now));
                     token_swap.success = Some(Timestamped::new(false, now));
                     state.data.token_swaps.upsert(token_swap);
                 });
@@ -99,7 +99,7 @@ pub(crate) async fn process_token_swap(mut token_swap: TokenSwap, attempt: u32)
             let msg = format!("{error:?}");
             mutate_state(|state| {
                 let now = state.env.now();
-                token_swap.transfer = Some(Timestamped::new(Err(msg.clone()), now));
+                token_swap.notified_dex_at = Some(Timestamped::new(Err(msg.clone()), now));
                 state.data.token_swaps.upsert(token_swap.clone());
                 enqueue_token_swap(token_swap, attempt, now, &mut state.data);
             });
@@ -144,7 +144,7 @@ pub(crate) async fn process_token_swap(mut token_swap: TokenSwap, attempt: u32)
     let (successful_swap, amount_out) = if let Ok(amount_swapped) = swap_result {
         (true, amount_swapped.saturating_sub(args.output_token.fee))
     } else {
-        (false, args.input_amount.saturating_sub(args.input_token.fee))
+        (false, args.input_amount.saturating_sub(2 * args.input_token.fee))
     };
 
     if extract_result(&token_swap.withdrawn_from_dex_at).is_none() {