BlockchainAdvanced#DEX#Interoperability
Atomic Swap
A
Definition
A smart-contract technology that enables the direct exchange of cryptocurrencies across different blockchains without intermediaries.
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Concept Diagram
Key Takeaways
1
Atomic swaps enable peer-to-peer trading of different cryptocurrencies without a centralized intermediary
2
They use hash time-locked contracts (HTLCs) ensuring both parties complete the trade or neither does
3
The atomic nature means the swap either completes entirely or is fully reversed — no partial states
4
Enable true cross-chain decentralization by removing the need for trusted exchanges
Practical Example
You want to trade 1 BTC for 15 ETH without using an exchange. An atomic swap creates an HTLC: you lock 1 BTC in a contract, the other party locks 15 ETH in another. When you claim the ETH, the BTC is automatically released — or both are refunded after timeout.
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Related Terms
Blockchain
Cross-Chain BridgeA protocol that enables the transfer of assets and data between two different blockchain ecosystems.
Blockchain
DEX (Decentralized Exchange)A P2P marketplace where users can trade cryptocurrencies directly without a central intermediary taking custody of funds.
Blockchain
Layer 2 (L2)A secondary framework or protocol built on top of an existing blockchain (L1) to improve scalability and transaction speed.
Blockchain
Smart ContractA self-executing contract with the terms of the agreement between buyer and seller being directly written into lines of code.
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