Developers Forum for XinFin XDC Network

Nitin Kumar Maurya
Nitin Kumar Maurya

Posted on

What is atomic cross-chain token transfers?

Can anyone explain what is "atomic cross-chain token transfers" on XDC network and how its works on XDC network.

Discussion (1)

sarthak_bakshi profile image
sarthak bakshi

Hey Nitin,

So very simply put, an atomic swap is a cryptocurrency exchange between two parties that wish to exchange tokens from different blockchains.

For example someone wanting to exchange ETH for XDC without having to go through centralized exchanges can do so by using a DEX ( a decentralised exchange) that would have ample liquidity and can support the "atomic swap".

Another way could be through the use of Interoperable bridges, this would essential convert your ETH tokens (erc-20) into wrapped tokens (XRC20) for you to use on the network to interact with any Dapp you want.

DIMO and wanchain have built a few XDC bridges, which also use an advanced version of the Lock-Mint-Burn-Unlock method to transfer assets between blockchains.

The bridges are direct bridges, meaning they require no intermediaries or relay networks to complete crosschain transactions. Rather, when moving assets from one blockchain to another, the assets are transferred directly from the source chain to the destination chain. For example, when moving Bitcoin to XDC network, the BTC is locked on the Bitcoin Network by the bridge nodes before a wrapped BTC is minted on XDC. There is no intermediary step or middlemen.

When the bridges are deployed, XDC holders will be able to use their XDC within any DeFi application on Wanchain, Polygon, Avalanche and BNB Chain. In a tangible way, these bridges increase the number of use cases for XDC, exponentially.

These bridges also open the door for assets from other chains to move to XDC network.

So far we have live bridges for:

With many more to come.