Atomic Swap

Atomic swaps rely on a form of cryptographic encryption known as hash time-locked contracts (HTLCs). HTLCs are a type of smart contract that enables two parties to exchange cryptocurrencies in a secure and decentralized manner. The contract contains a hash lock that can only be unlocked by a special key that is known only to the parties involved.

Once the conditions of the contract are met, the cryptocurrencies are exchanged automatically and simultaneously, without the need for a trusted intermediary. Atomic swaps offer several benefits to traders, including increased security, privacy, and decentralization. Because there is no need for a centralized exchange or intermediary, atomic swaps reduce the risk of hacking, fraud, or theft. They also enable traders to exchange cryptocurrencies without disclosing their identities or personal information, providing greater privacy and anonymity.