Building trustless cross-blockchain trading protocols is challenging. Centralized exchanges thus remain the preferred route to executing transfers across blockchains. However, these services require trust and therefore undermine the very nature of the blockchains on which they operate. To overcome this, several decentralized exchanges have recently emerged which offer support for commit-reveal atomic cross-chain swaps (ACCS).
Commit-reveal ACCS, most notably based on HTLCs, enable the trustless exchange of cryptocurrencies across blockchains. To this date, this is the only mechanism to have been deployed in production. However, commit-reveal ACCS face numerous challenges:
Commit-reveal ACCS have been around since 2012. The practical challenges explain their limited use in practice.
XCLAIM is a framework for achieving trustless and efficient cross-chain exchanges using cryptocurrency-backed assets (CbAs). XCLAIM allows to create assets which are 1:1 backed by existing cryptocurrencies, without requiring trust in a central operator. While this approach is applicable to a wide range of cryptocurrencies, we currently focus on implementing Bitcoin-backed tokens on Ethereum, i.e. XCLAIM(BTC,ETH).
XCLAIM introduces three protocols to achieve decentralized, transparent, consistent, atomic, and censorship resistant cross-blockchain swaps:
The current XCLAIM prototype is compliant with the ERC20 standard. An overview of the protocol is presented below:
XCLAIM guarantees that Bitcoin-backed tokens can be redeemed for the corresponding amount of Bitcoin, or the equivalent economic value in Ethereum. Thereby, XCLAIM overcomes the limitations of centralized approaches through three primary techniques:
To test performance and costs, we implemented both XCLAIM and HTLC ACCS between Bitcoin and Ethereum.
Our experiments show:
XCLAIM is cheaper and faster than HTLC Atomic Swaps.
Storage and execution costs are in USD as per exchange rates of 30 Nov. 2018: BTC/USD 3717.38 and ETH/USD 105.71. Performance is measured in minutes and includes recommended security parameters: 6 conf. a 10 min for Bitcoin; 12 conf. a 14 sec for Ethereum.
XCLAIM is a research project at the Imperial College London Centre for Cryptocurrency Research and Engineering, which is funded by Blockchain.com and Outlier Ventures.
DISCLAIMER: This sole purpose of this website is to provide information on the challenges of blockchain interoperability and the solution approach provided in the XCLAIM research paper.
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