Atomic swaps! What's so great about them?

If you are just getting into investing in Bitcoin, you might be hearing more and more about atomic swaps. It's a pretty exciting concept that is rapidly approaching functionality for the masses.

For an expert technical explanation of atomic swaps, I found a nicely detailed article here that you might like to peruse. I'm going to keep things pretty simple. Let's focus more on what makes atomic swaps so important for you as an investor and Bitcoin user.

In a nutshell, atomic swaps will usher in a truly decentralized cryptocurrency environment. As of now, if you want to buy one coin with Bitcoin, or sell another coin for Bitcoin, you need to use an exchange. You entrust the exchange to do what it is supposed to do - take your coin, exchange it, buy the other coin, deliver it, all for a nominal fee. The problem with this, is that it involves you entrusting your coins to a third party during this process.

Now, I would never recommend leaving your coins on an exchange long-term -- it's just too vulnerable to theft or loss. Normally, however, trading coins on exchanges has been a fairly decent procedure, but it is still not as accessible as simply selling directly to another buyer through atomic swaps (or buying directly from another seller). Atomic swaps also make it impossible for traders using the process to fall victim to the next exchange hack or collapse. This will enable Bitcoin and other atomic swap-capable coins to be exchanged without any intermediary. Pretty sweet.

At the moment, there are a few known coins that are developing lightning network capability or other solutions to enable atomic swaps (some off-chain, others on-chain): Litecoin, Vertcoin, Decred, Black Coin and, of course, Bitcoin. This process has been tested successfully with these coins.

If you are looking to add some more coins to your portfolio, atomic swap-enabled coins will be strong contenders for growth and utility.

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*This is not professional trading advice! Do not spend more than you can afford to lose.

sources:
https://www.cryptocompare.com/coins/guides/what-are-atomic-swaps
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