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Use Case of Atomic Swaps

I’ve seen some comments here saying “why would anyone swap their monero for “tainted” bitcoin”. It’s a valid point, but I think atomic swaps lessen the impact and fear of exchanges delisting monero, which is huge. Let’s say most of the major exchanges that now list monero decide to de-list it due to government pressure. Without atomic swaps, that’s a problem. Someone with a pile of monero will not easily be able to sell it if need be. With atomic swaps, it’s not a problem at all. You merely swap your monero into bitcoin, and then sell it on an exchange.

I don’t know if this is obvious, or irrelevant. But just a thought I had.

What do you think?

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9 Comments

  1. > You merely swap your monero into bitcoin, and then sell it on an exchange.

    the problem is that the seller of the monero has to do their own KYC with the bitcoin seller , otherwise the monero seller could receive useless bitcoin.

    So, it is a problem. You can’t just take *any* bitcoin and send it to an exchange and then get fiat or whatever. You need clean bitcoin.

    https://sethsimmons.me/posts/fungibility-graveyard/

  2. I don’t think atomic swaps work like an AMM. So you would need willing sellers at a stated price. Not sure you can really frontrun the market in that way, especially if demand to do so is extremely high. I did read there will be a mechanism to let the swapper of the BTC validate that it’s “clean” … Which would not be surprising to see as a general public utility if the market wants to keep bringing attention to that feature of Bitcoin mining (green, clean, compliant, etc).

  3. Exactly you can then benefit from the liquidity of Bitcoin.

    And because lots of people want to be anonymous, they will provide liquidity, traffic, and so higher anonimity set to Monero, as well as transaction fees, etc.

    There is no way this is bad for Monero, in my opinion, it will be huge.

  4. If Monero/ privacy coins were eventually delisted from major exchanges, how would their value be determined?

    As I understand it, the value is tied to the supply & demand measured on individual exchanges.
    The ARRR guys are always talking about the major discrepancies in prices for ARRR across exchanges. While a few exchanges list ARR, it seems only one is functional for deposits and withdrawals. I think the other’s currently allow exchanges only, which deters most people from transacting. This is probably why the price differs as the supply/demand is very different for these exchanges.

    Does that sound right?
    What would happen to price if Monero was only available through atomic swaps?

  5. A tainted bitcoin doesn’t indefinitely stay tainted under current chain analysis techniques. After a certain number of hops its nolonger associated with the tainting event. That’s why mixers and hopping bitcoin techniques have been so successful thus far. I think those techniques will lessen the impact of receiving tainted bitcoin from a xmr/btc hop.

    It’s also pertinent to note that as decenteralized exchanges gain more liquidity and popularity one can turn their sketchy btc for stable coins and send those to exchanges instead.

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