Atomic Swaps

(From Token Economy by Shermin Voshmgir)

“Atomic swaps allow for P2P cross-chain trading and can be directly executed between separate blockchain networks, wallet to wallet, without a trusted intermediary like an exchange.”
Hash Time-Locked Contracts (HTLC) are used.
Ensures that both parties fulfill requirements.
They remain in control of their private keys and tokens when making trade
Atomic swap requirements:
- Both parties need to download the ledgers of both networks
- both networks must support HTLC’s and use the same cryptographic hash function (?)
- If wallet-to-wallet: wallet used must also have atomic swap capabilities
Does not resolve the coincidence-of-wants problem
Decentralized Exchanges (DEX) attempt to resolve this
Future topics: HTLC, DEX