Exchanges between Bitcoin and Monero blockchains get closer thanks to donation

An anonymous donation of USD 260 thousand in XMR brings the community one step closer to the implementation of atomic swaps (atomic swaps) between Bitcoin and Monero. The development, which already has a stable protocol, expects the production of an open source client that allows direct exchange between both blockchains, without the need to resort to centralized exchanges.

One advertisement disseminated by Twitter this October 13 indicates that the financing of 2,727 XMR (USD 347.3 thousand) has already been almost reached, since 2,549.05 XMR (USD 323.5 thousand) has been collected. The fundraising project emerged on September 12, as a response to the need expressed by the user community to be able to exchange bitcoins and XMR through atomics swaps.

According to team From GetMonero, this type of inter-blockchain exchanges would allow people to bypass exchanges that request personal information to operate. This is possible thanks to atomic swap, which allow the creation of P2P payment channels both inside and outside the blockchain, as described in the CriptoNoticias glossary.

Among the benefits that people could obtain from this tool is the possibility of “Open a Lightning channel of exchange between monero and bitcoin or (…) finance an arbitrary bitcoin contract”, is indicated in the financing proposal. Also, as the developers suggest, it could increase Monero’s liquidity in the future.

At the time of writing this note, the goal is close to being achieved. Source: Monero

What does this Monero design imply to do atomic swaps with Bitcoin?

Monero will integrate with this project the Rust programming language in the protocol, which has traditionally been built with C ++. This programming language is already being adopted by other projects such as Ethereum for the design of smart contracts.

The project proposes the creation of a set of programs similar to those already used in Monero. For example, the creation of a wallet with command interface (CLI) or with a graphical interface GUI for users unfamiliar with programming language (come on, a wallet that looks like any other). In addition, a Daemon client would be designed, which would be the software that allows atomic swaps to be executed between the blockchains.

These wallets, considered as thin clients by the Monero team, they would sync with the blockchains when connecting to full nodes, due to the need to confirm blocked transactions in multi-signature smart contracts on both chains. In other words, the wallets will connect directly to the specific customer that allows atomics swap.

For example, if you, as an end user, want to acquire monero and have bitcoin, you will launch a swap client that connects to a Daemon Swap, and connects [también] to a counterparty that has monero and is looking to exchange it for bitcoin at an agreed price. The swap client will give you an address where to move your bitcoin and, at the end of the exchange, the swap client will show the monero key pair to import into your wallet. You now own moneros. If at any point the exchange is canceled for any reason, your bitcoin will be refunded to the address you choose, making this exchange trustworthy.

GetMonero team

The Monero team states that For now there are no standards for this type of exchange to be implemented in decentralized exchanges, that allow people to connect with each other on a platform for that purpose.

In addition, they warn that “with power comes responsibility” and anyone who wants to make exchanges atomics swaps between Bitcoin and Monero must do “its due diligence regarding the origin of the counterpart funds and possibly other countermeasures against money laundering”.

Monero and Bitcoin on the deep web

In July of this year, a report on the 40% increase in the use of Monero pointed to the deep web markets as a possible cause of the increase. Further analysis suggests that both bitcoin and monero compete with each other as a form of payment in illegal markets.

Although various studies suggest that total bitcoin funds, which are used to manage or negotiate illegal activities, represent less than 1% of its total flow in the markets, as reported by the research firm Chainalysis.

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Exchanges between Bitcoin and Monero blockchains get closer thanks to donation

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