Cross-Chain Atomic Swaps Using Dutch Auction Escrow
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Solution Overview
Problem
Existing atomic swaps require complex interactions from both parties and lack flexibility, often necessitating technical knowledge and experience, and are limited by poor user experience and security concerns in existing wallets or exchange services.
Innovation Solution
A system and method for secure cross-chain atomic swaps using a swap platform that automates the swap process through a Dutch auction approach, involving a relayer service, smart contracts, and escrow contracts, allowing users to submit signed limit orders without active involvement, with resolvers handling the execution.
Engineering Contradictions & Design Principles
Engineering Contradiction Analysis
1Adaptability or versatility
If classic atomic swap is used, then tokens can be swapped across different blockchain networks, but the process requires complex interactions from both parties and lacks flexibility
Solution Approach 1:
The patent introduces a smart contract intermediary that automatically manages the atomic swap process between two parties. The smart contract holds tokens in escrow and automatically releases them when conditions are met, eliminating the need for complex manual interactions while maintaining the atomic nature of the swap across different blockchains.
Solution Approach 2:
The system enables self-service atomic swaps where users can initiate and complete swaps without requiring active involvement from the counterparty during execution. The smart contract autonomously verifies conditions and executes the swap, reducing the complexity of interactions required from users.
2Ease of operation
If specialized wallets or exchange services are used to streamline atomic swap, then user experience improves, but security concerns arise and flexibility is reduced
Solution Approach 1:
The patent uses a decentralized smart contract intermediary rather than a centralized wallet or exchange service. This smart contract intermediary provides the streamlining benefits of centralized services while maintaining the security and trustlessness of decentralized systems, as the contract code is transparent and cannot be manipulated.
Solution Approach 2:
The smart contract system is designed to be universally applicable across different blockchain networks and token types. It maintains flexibility by supporting various swap conditions and parameters while providing a standardized, secure interface for users, eliminating the need for specialized wallets for different scenarios.
3Extent of automation
If automated swap execution is implemented, then user involvement is reduced, but the system requires sophisticated smart contract mechanisms
Solution Approach 1:
The smart contract is designed to autonomously execute the atomic swap without requiring user intervention during the critical exchange phase. It automatically verifies token deposits, checks swap conditions, and releases tokens when conditions are met, achieving high automation while keeping the user experience simple.
Solution Approach 2:
The patent segments the atomic swap process into distinct phases handled by separate contract functions: token deposit verification, condition checking, and token release. This modular approach reduces the apparent complexity for users while maintaining sophisticated automated execution capabilities.
Data Source
AI summary
Systems and methods for a secure cross-chain atomic swaps are disclosed herein. A user submits to a swap platform a signed limit order to atomically swap an amount of input token for an output token. The swap may involve a Dutch auction approach, in which the order execution price depends on time of inclusion in a block and decreases over the duration of the Dutch auction. The swap platform provides the order details to whitelisted resolvers to evaluate if/when/how to fill the order. Once a resolver makes that determination, it can utilize smart contracts associated with the swap platform to perform the atomic swap on behalf of the user and itself (e.g., without active involvement of the user). Input tokens deposited on an escrow contract are unlocked at the same time that output tokens deposited on another escrow contract are unlocked.