Tai Zen: Can you explain briefly what is an Atomic Swap? Cause we’re talking about it, but let’s define it for the audience.
Marco: Okay. So an Atomic Swap is where you take one cryptocurrency, you exchange it for not a cryptocurrency, without a third party. So it is a trustless but safe way of exchanging tokens.
Marco: We would agree on a price. Let’s say a 10 to 1. So there’ll be great, probably a couple more, so let’s say 100 to 1. We would agree to that and then I would create a transaction on my Decred chain. You would create and transaction on the Bitcoin blockchain. And then they would monitor each other. And then once the magic values match up, then literally it’s an Atomic Swap.
Leon: Can you give me, like you want Bitcoin, you can give a magic number.
Marco: You give me a magic number that you are going to derive. Once you see something happened to my chain and then you do the same. When those two match up, that’s when the actual swap happened.
Leon: Even though I don’t know you, I don’t trust who you are. I can still give you my Bitcoin, knowing that you are going to give me the amount of Decred.
Marco: You cannot cheat this. There’s an encoding if you will, where you encode the number, the amounts, and all the other things and that magical number. Once they all add up, if I would actually put less on price, it would not work.
Leon: It would not work. Okay. So it has to be this much, the Decred has to show up in my wallet before you get my Bitcoin.
Marco: Right, and vice versa. Atomically, so they happen at the same time.
Leon: Or they don’t happen at all.
Marco: Right. So it’s both. All or nothing.
Leon: Right now, do you need a special wallet to support this?
Marco: Currently you need. And this is where it’s not so useful yet. This currently is all command-line tools. We can exchange actually with several, but we can do Litecoin, we can do Bitcoin. I want to say VERGE, I think that’s another one. I do not afford the fifth convert.
Tai Zen: But everything has to originate from Decred.
Marco: No, actually Decred’s scripting language is the same as Bitcoin scripting language and that’s why we can do Litecoin and so things like when narrow would be more complicated.
Tai Zen: Cause they always coined anything that’s off of the Bitcoin.
Tai Zen: Hi guys, thanks for watching this video. If you like our boots on the ground, type of investing approach, we’ll go and talk to the actual development teams to make sure that real people get real information, from real people not simply working in their mom’s basement. Make sure you follow us at www.cryptocurrency.market/newsletter and we’ll look forward to seeing you in the next video. Thank you.