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Author Topic: How will atomic swops affect exchanges  (Read 112 times)
Jet Cash
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August 08, 2018, 07:58:23 AM
 #1

Atomic swops are a relatively new concept, and they present a way to avoid exchanges. How do you think the exchanges will react as atomic swops become more popular?

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August 08, 2018, 08:19:49 AM
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If the Atomic swaps exchanges will be easy to use like the centralized ones, then I see no reason on why people would continue to use bittrex, binance etc. In fact, It will be better because there will be almost no fees and more secure as you're in full control of your funds.

The current exchanges will become obsolete, maybe they'll switch to crypto/fiat instead of crypto/crypto because even If they choose to switch to atomic swaps, It won't be profitable as they can't charge any fees I guess?


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August 08, 2018, 08:47:30 AM
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Exchanges will become obsolete for sure. Hail true decentralization.
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August 08, 2018, 08:51:54 AM
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Exchanges will become obsolete for sure. Hail true decentralization.

Probably not entirely obsolete. Atomic swaps(when working decently fast, and when easy to use enough, etc), will definitely decrease the usage of centralized exchanges. Though I don't think centralized exchanges will simply die out though, as we still need a platform to buy and sell cryptocurrencies using fiat; unless cryptocurrencies will be so globally adopted that it would be easy to find a buyer/seller in your city and transact peer-to-peer in person.

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August 08, 2018, 01:17:22 PM
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So entry from fiat to crypto means exchanges stay open, I agree but the only way atomic swaps could really affect exchanges if their user experience was 100% friendly. Exchanges help newer traders and enthusiasts come into the space. The concept of an atomic swap, in my opinion is too much for a beginner (not saying its impossible to understand) but you need to familarise yourself with a lot of terminology before you can delve in atomic swaps.
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August 08, 2018, 04:05:24 PM
 #6

If Atomic swaps do indeed become the next 'big thing' then or sure exchanges are in trouble.....sort of!

As someone has pointed out already, you still need the FIAT to crypto entry point which i can't see disappearing anytime in the immediate future, so for that reason the best of the exchanges will survive, however not every crypto project is going to be instantly available to atomic swap until its proved its worth/popularity. So again, thats where exchanges use case comes in.

If Atomic Swaps became really popular, i think bigger exchanges would likely use incentives and promotions to get people to still use them. Ultimately it all points to a positive move for us as customers/consumers.

 The likes of Binance and Coinbase are making absolute fortunes from people and projects....and giving little back! It seems like the 'decentralized' world is becoming Centralized 2.0!  Roll Eyes 
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August 09, 2018, 04:35:04 AM
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we will once again face the chicken and egg problem like we are now facing with decentralized exchanges!

for example decentralized exchanges are awesome in theory  but when you check it out you can see the volume is not high so you don't trade there and because you don't trade there the volume never goes up.
so in the future lets say LTC is getting pumped and i want to participate using Atomic Swaps. when i go to the market place and see there is a risk that if i sell my LTC and wait for the dip and in that dip there may be no sell orders that i can buy from then i wouldn't use it, i go to the same old centralized exchanges because i am sure that if i sell 100 LTC i can find a sell order later to fill without any issue.

and lets not forget that Atomic Swap doesn't work with all the altcoins so there is a restriction there too. and also you have to trust that altcoins implementation of it which may not be the worst thing but still it can be untested code for some smaller unknown altcoins.

and finally for Atomic Swap i have to run a node, like an LN node, run an application and learn how to use it and that may not be desirable for some people specially the "hobby traders" who aren't heavily invested in it and want to make some trades from time to time. but using a centralized exchange only requires a browser which we already have.

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August 10, 2018, 02:25:50 PM
 #8

If Atomic swaps do indeed become the next 'big thing' then or sure exchanges are in trouble.....sort of!

As someone has pointed out already, you still need the FIAT to crypto entry point which i can't see disappearing anytime in the immediate future, so for that reason the best of the exchanges will survive, however not every crypto project is going to be instantly available to atomic swap until its proved its worth/popularity. So again, thats where exchanges use case comes in.

If Atomic Swaps became really popular, i think bigger exchanges would likely use incentives and promotions to get people to still use them. Ultimately it all points to a positive move for us as customers/consumers.

 The likes of Binance and Coinbase are making absolute fortunes from people and projects....and giving little back! It seems like the 'decentralized' world is becoming Centralized 2.0!  Roll Eyes 

Hmm, interesting view - I didn't think about the incentives actually. Do you think binance will dish BNB out for free? Maybe!! Smiley
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August 10, 2018, 02:28:36 PM
 #9

We should head towards decentralisation in every aspect of finances. Exchanges might not stand a chance after some time when atomic swaps will be more adopted.
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August 10, 2018, 03:39:57 PM
 #10

I thought atomic swops were peer to peer, so they only take place when there is an agreed exchange between two parties.

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anchy
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August 10, 2018, 03:57:46 PM
 #11

Atomic swaps will be an awesome thing more crypto, true power of decentralization, but it looks like they are nowhere near being widely used. It's still early testing phases and I'm sure that years will pass till we get to that phase when exchanges start to really worry about this. There will certainly be a big resistance from big players (exchanges) so it will make swaps take even more time. But ultimately it's a great thing.
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August 10, 2018, 05:56:07 PM
 #12

Atomic swaps are good. You can trade compatible coins without a middleman (e.g. exchange, escrow) and without high fees. You receive the coins direct to your personal wallet, instead of to a wallet controlled by the exchange. As far as I understand it, you would still need to find someone who wants to trade, therefore you would need a platform or forum for buy/sell ads.

I use shapeshift.io to exchange coins, but look forward to when atomic swaps will be widely used, due to lower fees (shapeshift takes 5-10%) and no trust required due to hash time-locked contracts.

Interesting articles about atomic swaps:
https://coincentral.com/what-are-atomic-swaps-a-beginners-guide/
https://bitcoinmagazine.com/articles/atomic-swaps-how-the-lightning-network-extends-to-altcoins-1484157052/
https://www.cryptocompare.com/coins/guides/what-are-atomic-swaps/

Quote from: pooya87
and finally for Atomic Swap i have to run a node, like an LN node, run an application and learn how to use it and that may not be desirable for some people specially the "hobby traders" who aren't heavily invested in it and want to make some trades from time to time. but using a centralized exchange only requires a browser which we already have.
I read that atomic swaps could be possible in the future with electrum wallet, therefore you dont need to download the whole blockchain, if you dont have enough storage/bandwidth.

Though I don't think centralized exchanges will simply die out though, as we still need a platform to buy and sell cryptocurrencies using fiat; unless cryptocurrencies will be so globally adopted that it would be easy to find a buyer/seller in your city and transact peer-to-peer in person.
This is what I hope for bitcoin - bitcoin ATMs and p2p traders in every city worldwide.

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August 11, 2018, 04:10:26 AM
 #13

Quote from: pooya87
and finally for Atomic Swap i have to run a node, like an LN node, run an application and learn how to use it and that may not be desirable for some people specially the "hobby traders" who aren't heavily invested in it and want to make some trades from time to time. but using a centralized exchange only requires a browser which we already have.
I read that atomic swaps could be possible in the future with electrum wallet, therefore you dont need to download the whole blockchain, if you dont have enough storage/bandwidth.

generally speaking light/SPV wallets are not as safe as a full verification wallet and they are not fraud proof. at the very least you are losing privacy.
when it comes to Lightning channels and Atomic Swaps (although i still don't have enough information about this) things are still not 100% safe. and i believe there are problems with it such as needing to trust the server with your transaction revocation private keys. and i think there are some other attack vectors there too.

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