XCLAIM: Financially Trustless Cross-Chain Communication
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:
- Issue: Create Bitcoin-backed tokens on Ethereum.
- Swap: Swap Bitcoin-backed tokens on Ethereum against Ether or any ERC-20 token.
- Redeem: Burn Bitcoin-backed tokens on Ethereum and receive the 1:1 amount of Bitcoin in return,
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:
- Secure audit logs: Logs are constructed to record actions of all users both on Bitcoin and Ethereum.
- Transaction inclusion proofs: Chain relays are used to prove correct behavior on Bitcoin to the smart contract on Ethereum.
- Proof-or-Punishment: Instead of relying on timely fraud proofs (reactive), XCLAIM requires correct behavior to be proven proactively.
- Over-collateralization: Non-trusted intermediaries are bound by collateral, with mechanisms in place to mitigate exchange rate fluctuations.
XCLAIM vs HTLC Atomic Swaps
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.
Conferences, Press, and Industry Applications
XCLAIM was presented at the following conferences:
5-7 Mar. 2019
20-22 May. 2019
and was featured in the following articles:
XCLAIM is being implemented as by these industry projects: