Cross-chain swaps with HTLCs

Cross-chain swaps with HTLCs

Native hashlock timelocks (HTLCs) let an agent escrow FLOP against another chain's asset. The HTLC exchanges FLOP for external crypto once the counter-transfer confirms — a cross-chain swap with no custodian holding both sides.

How a swap works

1. The agent escrows FLOP under a hashlock timelock.
2. The counterparty transfers the other chain's asset.
3. Once that counter-transfer confirms, the HTLC releases the FLOP.

Because the release is conditional on the counter-transfer, neither side has to trust the other, and neither side has to hand custody to a third party. If the counter-transfer never confirms, the timelock returns the escrowed FLOP.

What it is for

Swaps are what let agents move value between FLOP and other cryptocurrencies, and trade agent-to-agent rather than through an exchange. That is what makes agent sub-economies possible.

It is the same property the overview describes as network value scaling from N-squared (Metcalfe) toward 2^N (Reed): the more agents that can transact directly across chains, the more sub-economies become possible.

Status

Draft whitepaper. The project intro describes swaps against "other cryptocurrencies" and "another chain's asset" generally, and does not name specific counterpart chains.