On October 11th, 2017, Altcoin.io successfully traded .12345 Bitcoin for .12345 Ethereum using an atomic swap from their wallet. This is a look into what atomic swaps are, and how they're changing the face of cryptocurrency trading.

On October 11th, 2017, Altcoin.io (formerly known as the Altcoin Exchange) successfully traded .12345 Bitcoin for .12345 Ethereum using an atomic swap from their wallet. Although there have been a few successful atomic swaps in the past, they have only been produced through Litecoin, Decred, Viacoin and Vertcoin. Being that Bitcoin and Ethereum are the two heaviest traded coins on the market, Altcoin.io is showing that their decentralized exchange has what it takes to upset the entire exchange market.

Atomic Swaps

Atomic swaps will change everything. Their concept, in the future, will take down giants like Bittrex, Coinbase, and eventually marketplaces like eBay will have no way to stand against it. Atomic swaps take out all of the middlemen that centralized exchanges charge you for.

Let’s say I want to give an apple to Norma, for her orange. In a centralized exchange, we would both give our fruits to a middleman to hold onto until he/she receives both, and then will safely exchange our fruits for us (for a fee). In an atomic swap, you can think of that middleman as a floating mathematical algorithm that has the ability to reach out about switch both fruits simultaneously, so that the next time I reach into my pocket I find an orange there. It’s kind of like a smart contract, where x can be released when a and b are met. In fact, it is a smart contract- the first atomic swap (set up by Charlie Lee) was scripted using SCRIPT with a smart contract.

Decentralized exchanges and atomic swaps

Atomics swaps are a decentralized exchange’s best friend. P2P has many solutions but the hardest has been trust. Think about Craigslist: the hardest part about Craigslist is trusting that you will get what was agreed upon. The idea of an atomic swap in a decentralized exchange is to instantaneously swap the coins involved in the trade.

Does this sound familiar? You may be thinking of Shapeshift. Shapeshift does exactly this, except for one thing- Shapeshift charges fees for being the middleman. If you’ve used Shapeshift before, you’ll understand how frustrating it is to see how much you end up paying for this service. Shapeshift is a decentralized concept, and they should have known from the start that centralized concepts don’t last very long in a decentralized world.

Altcoin.io

While there are multiple decentralized exchanges out there, Altcoin.io is the first to swap from the Ethereum blockchain to the Bitcoin blockchain. It shows that they are serious about getting atomics swaps to become a universal thing around all coins. Atomic swaps are very complex to script, which is why atomic swaps cannot be made throughout all coins. But many coins are updating their blockchains to become more “atomic swap friendly.”

The interface for trading on Altcoin.io is sound- including many familiar features with some easy add-ons, like being able to customize the look of the exchange. The wallet isn’t completely out yet, but, but you can get a sneak peek here.

Centralized exchanges are well on their way out. The only reason we find ourselves even using them is because we have grown up in a centralized world: we are used to having someone else control our money, and, we forget that this means we can lose it as well.

 

Swapping directly from wallet-to-wallet leaves no room for hackers to take. Now it's up to the security of the wallet to hold up, which we are still waiting to hear about for Altcoin.io. If it's at all up to standards of wallets like Exodus and Jaxx, you will probably be more likely to lose your password forever than get hacked.

It's exciting to think that we are coming back to a time where we will have total control of our own assets. We have the technology now to back it up so that we can learn to trust ourselves to handle our money. Altcoin.io is just one example of what’s to come in 2018 exchange platforms.

Featured image from Pixabay

 

Verified on Po.et

November 3rd 2017, 13:26

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