Atomic swap - Revision history

Sharpiro: Changing from "72" to "48" hours in the algorithm explanation to be more precise and to match what is described in "TX2". Also this is now back into tune with TierNolan's original post.

2020-07-01T15:13:30Z

Changing from "72" to "48" hours in the algorithm explanation to be more precise and to match what is described in "TX2". Also this is now back into tune with TierNolan's original post.

← Older revision		Revision as of 15:13, 1 July 2020
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	Before 1: Nothing public has been broadcast, so nothing happens		Before 1: Nothing public has been broadcast, so nothing happens
	Between 1 & 2: A can use refund transaction after 72 hours to get his money back		Between 1 & 2: A can use refund transaction after 48 hours to get his money back
	Between 2 & 3: B can get refund after 24 hours. A has 24 more hours to get his refund		Between 2 & 3: B can get refund after 24 hours. A has 24 more hours to get his refund
	After 3: Transaction is completed by 2		After 3: Transaction is completed by 2
	- A must spend his new coin within 24 hours or B can claim the refund and keep his coins		- A must spend his new coin within 24 hours or B can claim the refund and keep his coins
	- B must spend his new coin within 72 hours or A can claim the refund and keep his coins		- B must spend his new coin within 48 hours or A can claim the refund and keep his coins

	For safety, both should complete the process with lots of time until the deadlines.		For safety, both should complete the process with lots of time until the deadlines.

Belcher: Fix link

2019-02-21T18:20:59Z

Fix link

← Older revision		Revision as of 18:20, 21 February 2019
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	A non-atomic trivial solution would have Alice send her coins to Bob, and then have Bob send other coins to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both sets of coins.		A non-atomic trivial solution would have Alice send her coins to Bob, and then have Bob send other coins to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both sets of coins.

	Atomic swaps can be used for trading between bitcoin and another cryptocurrency, or for trading [[~~Coinswap~~\|bitcoin and different bitcoin for privacy purposes]].		Atomic swaps can be used for trading between bitcoin and another cryptocurrency, or for trading [[CoinSwap\|bitcoin and different bitcoin for privacy purposes]].

Belcher: Add point about LN using near-atomic-swaps for routing, and the problems of optionality

2019-02-05T00:20:38Z

Add point about LN using near-atomic-swaps for routing, and the problems of optionality

← Older revision		Revision as of 00:20, 5 February 2019
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	A non-atomic trivial solution would have Alice send her coins to Bob, and then have Bob send other coins to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both sets of coins.		A non-atomic trivial solution would have Alice send her coins to Bob, and then have Bob send other coins to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both sets of coins.

	Atomic swaps can be used for trading between bitcoin and another cryptocurrency, or for trading [[Coinswap\|bitcoin ~~UTXOs~~ for privacy purposes]].		Atomic swaps can be used for trading between bitcoin and another cryptocurrency, or for trading [[Coinswap\|bitcoin and different bitcoin for privacy purposes]].


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	* It is legal for inputs to be mentioned multiple times, first (in blockheight order) transaction which gets "frozen" wins and other same-input consumers become invalid.		* It is legal for inputs to be mentioned multiple times, first (in blockheight order) transaction which gets "frozen" wins and other same-input consumers become invalid.

	== ~~Other references~~ ==		== Routed [[payment channels]] ==

			A closely-related concept to atomic swaps is used trading bitcoins in a payment channel for bitcoins in a different payment channel, which is how routed [[payment channels]] function in [[Lightning Network]].

			== Financial optionality ==

			Atomic swap protocols which exchange two different currencies can introduce an optionality. Optionality has value in a financial context which is expressed by options pricing<ref>https://blog.bitmex.com/atomic-swaps-and-distributed-exchanges-the-inadvertent-call-option/</ref>. There have been attempts to design atomic swaps protocol which minimize this unintended optionality<ref>http://diyhpl.us/wiki/transcripts/scalingbitcoin/tokyo-2018/atomic-swaps/</ref>. The point about optionality has been used to argue that [[Lightning Network]] can only ever be a single-asset network, it cannot involve atomic swaps between currencies along a payment route because the option-buyer has an incentive to intentionally slow down the payment<ref>https://lists.linuxfoundation.org/pipermail/lightning-dev/2018-December/001752.html</ref>.


			== See also ==
	* [https://bitcointalk.org/index.php?topic=91843.0 P2PTradeX: P2P Trading between cryptocurrencies]		* [https://bitcointalk.org/index.php?topic=91843.0 P2PTradeX: P2P Trading between cryptocurrencies]
	* [https://bitcointalk.org/index.php?topic=193281.0 Alt chains and atomic transfers]		* [https://bitcointalk.org/index.php?topic=193281.0 Alt chains and atomic transfers]
	* [https://bitcointalk.org/index.php?topic=1619536.0 Disintermediating Inter-Blockchain Transactions]		* [https://bitcointalk.org/index.php?topic=1619536.0 Disintermediating Inter-Blockchain Transactions]

			== References ==

Belcher: Fixed grammar error and added link to coinswap page

2018-12-18T13:50:01Z

Fixed grammar error and added link to coinswap page

← Older revision		Revision as of 13:50, 18 December 2018
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	A non-atomic trivial solution would have Alice send her coins to Bob, and then have Bob send other coins to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both sets of coins.		A non-atomic trivial solution would have Alice send her coins to Bob, and then have Bob send other coins to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both sets of coins.

	Atomic swaps can be used for trading between bitcoin and another cryptocurrency, or for trading ~~bitcoins of~~ privacy purposes.		Atomic swaps can be used for trading between bitcoin and another cryptocurrency, or for trading [[Coinswap\|bitcoin UTXOs for privacy purposes]].

Belcher: Edited to mention atomic swaps for privacy

2018-11-30T02:05:52Z

Edited to mention atomic swaps for privacy

← Older revision		Revision as of 02:05, 30 November 2018
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	The problem of '''atomic ~~cross-chain trading~~''' is one where (at least) two parties, Alice and Bob, own coins ~~in separate cryptocurrencies~~, and want to exchange them without having to trust a third party (centralized exchange).		The problem of an '''atomic swap''' is one where (at least) two parties, Alice and Bob, own coins, and want to exchange them without having to trust a third party (centralized exchange).

	A non-atomic trivial solution would have Alice send her ~~Bitcoins~~ to Bob, and then have Bob send ~~another cryptocurrency~~ to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both ~~Bitcoins~~ and ~~the altcoin~~.		A non-atomic trivial solution would have Alice send her coins to Bob, and then have Bob send other coins to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both sets of coins.

			Atomic swaps can be used for trading between bitcoin and another cryptocurrency, or for trading bitcoins of privacy purposes.

Belcher: Belcher moved page Atomic cross-chain trading to Atomic swap: The topic has developed more since 2011 when this was named

2018-11-30T02:04:02Z

Belcher moved page Atomic cross-chain trading to Atomic swap: The topic has developed more since 2011 when this was named

← Older revision	Revision as of 02:04, 30 November 2018
(No difference)

MMGen at 20:48, 28 January 2018

2018-01-28T20:48:16Z

← Older revision		Revision as of 20:48, 28 January 2018
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	2) B submits TX3 to the network		2) B submits TX3 to the network

	3) A spends TX3 ~~giving~~ x		3) A spends TX3, revealing x

	4) B spends TX1 using x		4) B spends TX1 using x

S. Matthew English: /* Other references */ adding information on a recent form post related to the atomic cross-chain trading problem

2016-09-17T15:52:51Z

Other references: adding information on a recent form post related to the atomic cross-chain trading problem

← Older revision		Revision as of 15:52, 17 September 2016
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	* [https://bitcointalk.org/index.php?topic=91843.0 P2PTradeX: P2P Trading between cryptocurrencies]		* [https://bitcointalk.org/index.php?topic=91843.0 P2PTradeX: P2P Trading between cryptocurrencies]
	* [https://bitcointalk.org/index.php?topic=193281.0 Alt chains and atomic transfers]		* [https://bitcointalk.org/index.php?topic=193281.0 Alt chains and atomic transfers]
			* [https://bitcointalk.org/index.php?topic=1619536.0 Disintermediating Inter-Blockchain Transactions]

Mmortal03: /* Solution using specialized altchain */

2016-03-26T06:49:52Z

Solution using specialized altchain

← Older revision		Revision as of 06:49, 26 March 2016
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	== Solution using specialized altchain ==		== Solution using specialized altchain ==

	The previously mentioned approach can be used directly to trade between bitcoin-derived chains without special support on the side of protocol. The obvious disadvantage is nLockTime - if counterparty does not go through the trade, our funds are locked and cannot used in another trade for the duration of timeout. ~~Additionaly~~, it depends on transaction replacement which may, or may not be considered standard under current bitcoin protocol rules.		The previously mentioned approach can be used directly to trade between bitcoin-derived chains without special support on the side of protocol. The obvious disadvantage is nLockTime - if counterparty does not go through the trade, our funds are locked and cannot used in another trade for the duration of timeout. Additionally, it depends on transaction replacement which may, or may not be considered standard under current bitcoin protocol rules.

	Another proposal of cross-chain p2ptrade is to use specialized altchain with properties for efficient operation of p2ptrade from bitcoin chain. ~~Additionaly~~, we use only single standard bitcoin transaction which looks exactly the same as normal payment (no nlocktime, no multisig, no special script).		Another proposal of cross-chain p2ptrade is to use specialized altchain with properties for efficient operation of p2ptrade from bitcoin chain. Additionally, we use only single standard bitcoin transaction which looks exactly the same as normal payment (no nlocktime, no multisig, no special script).

	Assuming the altchain has actual economic value to support it, it can even serve as proxy for (relatively) efficient zero-trust p2p market between fe. BTC and LTC thanks to arbitraging market makers.		Assuming the altchain has actual economic value to support it, it can even serve as proxy for (relatively) efficient zero-trust p2p market between fe. BTC and LTC thanks to arbitraging market makers.

Luke-jr at 04:35, 8 June 2014

2014-06-08T04:35:14Z

← Older revision		Revision as of 04:35, 8 June 2014
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	The problem of '''atomic cross-chain trading''' is one where (at least) two parties, Alice and Bob, own coins in separate cryptocurrencies ~~(e.g. Bitcoin and [[Litecoin]])~~, and want to exchange them without having to trust a third party (centralized exchange).		The problem of '''atomic cross-chain trading''' is one where (at least) two parties, Alice and Bob, own coins in separate cryptocurrencies, and want to exchange them without having to trust a third party (centralized exchange).

	A non-atomic trivial solution would have Alice send her Bitcoins to Bob, and then have Bob send ~~Litecoins~~ to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both Bitcoins and ~~Litecoins~~.		A non-atomic trivial solution would have Alice send her Bitcoins to Bob, and then have Bob send another cryptocurrency to Alice - but Bob has the option of going back on his end of the bargain and simply not following through with the protocol, ending up with both Bitcoins and the altcoin.