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What is an atomic swap and how can it benefit traders?

To buy, sell, or trade cryptocurrencies, most people currently have to use an exchange. One of the more exciting developments on the horizon though is atomic swaps, which could revolutionise the way we trade cryptocurrencies. In its simplest form, an atomic swap allows two people to trade their two different cryptocurrencies from wallet to wallet.…

What is an atomic swap and how can it benefit traders?

To buy, sell, or trade cryptocurrencies, most people currently have to use an exchange. One of the more exciting developments on the horizon though is atomic swaps, which could revolutionise the way we trade cryptocurrencies. In its simplest form, an atomic swap allows two people to trade their two different cryptocurrencies from wallet to wallet. Currently, the only way to swap Bitcoin for Litecoin is to use a centralised exchange. Here is how an atomic swap can benefit traders. Issues with exchanges Exchanges can be contentious. Whilst currently absolutely necessary in the cryptocurrency industry, this does not mean that they are immune to criticism. The most recent issue that has been highlighted with exchanges is the faking of volume. This

The post What is an atomic swap and how can it benefit traders? appeared first on Coin Rivet.

To buy, sell, or trade cryptocurrencies, most people currently have to use an exchange. One of the more exciting developments on the horizon though is atomic swaps, which could revolutionise the way we trade cryptocurrencies.

In its simplest form, an atomic swap allows two people to trade their two different cryptocurrencies from wallet to wallet. Currently, the only way to swap Bitcoin for Litecoin is to use a centralised exchange. Here is how an atomic swap can benefit traders.

Issues with exchanges

Exchanges can be contentious. Whilst currently absolutely necessary in the cryptocurrency industry, this does not mean that they are immune to criticism. The most recent issue that has been highlighted with exchanges is the faking of volume. This can make exchanges appear more active and popular than they are in reality. Therefore, they can then attract more ICOs and charge a high listing fee and increase their revenue. This is just one tactic that unregulated exchanges have used in the past.

For those who trade regularly, one of the main gripes of using exchanges is the fees that are charged. Whilst small, these can add up and hit your portfolio. As we have seen recently as well, many exchanges are vulnerable to hacks, so keeping your cryptocurrency in your own wallet is much safer than storing them on an exchange.

Another issue for many Cypherpunks is that regulated exchanges require KYC, which crypto anarchists view as harmful to their privacy. Atomic swaps can render exchanges obsolete though.

What is an atomic swap?

What makes an atomic swap particularly interesting is that you can trade (or ‘swap’) different cryptocurrencies peer to peer, so the need for exchanges is greatly reduced. Atomic swaps greatly increase the idea of decentralisation and trustlessness that are key tenants of cryptocurrencies.

The idea was first theorised in 2012 and then advanced in 2013 by Tier Nolan. Although it has been six years since then, atomic swaps are not yet widely available with the technology still very much in the testing phase.

To give an example, if I want to swap my Bitcoin with a friend’s Litecoin, we agree on a price and then these currencies are swapped with no fear of either him or me backing out of the trade. If one person does change their mind, then the other will simply receive a refund.

There are two different types of atomic swap. The first is on-chain, meaning it is processed on the blockchain. The second is off-chain, meaning the swap is processed via a second layer solution such as Lightning. Bitcoin and Litecoin were the first to achieve an off-chain swap via the Lightning Network. For an on-chain swap, both cryptocurrencies must support hash time locked contracts and use the same hashing algorithm. Decred and Litecoin are examples of two cryptocurrencies that have completed an on-chain swap.

Komodo is another cryptocurrency that has investigated the use of atomic swaps heavily. The company provided a first when it was able to swap Ethereum for Dogecoin via an atomic swap.

When will we see them more commonly?

Currently, there are still quite a few issues that need to be ironed out before we see atomic swaps more commonly. The two biggest limitations are that generally the cryptocurrencies used for on-chain swaps need to have hash time locked contracts and the same hashing algorithm. This instantly limits the amount of cryptocurrencies capable of partaking in atomic swaps.

For off-chain swaps using the Lightning Network, again there are very few cryptocurrencies that are currently using Lightning. Even on Bitcoin, whilst growth has been impressive, Lightning is not yet near full release.

Like many improvements in cryptocurrency, these advancements take time, as a bug in the code can have major consequences. Therefore, remaining patient is key.

Benefits for traders

The main benefits for traders is you can avoid all the pitfalls that exchanges provide. Firstly, the coins remain in your wallet so you are less likely to succumb to a hack (as long as your own security is tight).

For those keen on privacy, KYC will not be necessary to perform an atomic swap. Finally, traders will not have to worry about exchanges taking an excessive fee off the top of their trades. With the implementation of the Lightning Network as well, these trades could happen in a much quicker time.

Conclusion

Atomic swaps could be the next big evolution in cryptocurrencies. There is definitely a lot of excitement surrounding them. They will increase decentralisation and could theoretically remove the need for any central exchanges.

Whilst they are unlikely to arrive imminently, the advancement in the usability of Lightning will certainly help speed up the process, and with other coins such as Decred, Komodo, and Litecoin working on the technology, it is likely that more will follow.

Although many people focus on the price of cryptocurrencies, the developers working in the background are usually up to much more exciting advances.

The post What is an atomic swap and how can it benefit traders? appeared first on Coin Rivet.

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Bitcoin, Ethereum, Ripple, Bitcoin Cash, Litecoin, EOS, Binance Coin, Stellar, Cardano, TRON: Price Analysis May 3

HitBTC exchange.” data-reactid=”28″ type=”text”>Market data is provided by the HitBTC exchange.Intercontinental Exchange Inc (ICE) has been loading up on digital assets for its cryptocurrency platform Bakkt, according to its chief executive officer Jeffrey Sprecher. This has helped ICE buy assets at a discount, which would not have happened if the markets were in a bull…

Bitcoin, Ethereum, Ripple, Bitcoin Cash, Litecoin, EOS, Binance Coin, Stellar, Cardano, TRON: Price Analysis May 3
HitBTC exchange.” data-reactid=”28″ type=”text”>Market data is provided by the HitBTC exchange.

Intercontinental Exchange Inc (ICE) has been loading up on digital assets for its cryptocurrency platform Bakkt, according to its chief executive officer Jeffrey Sprecher. This has helped ICE buy assets at a discount, which would not have happened if the markets were in a bull phase. Sprecher expects Bakkt to start operations later in 2019.

Attention has been shifting to institutional investors since the bear phase started. Stronger hands with deeper pockets are needed to provide stability in crypto markets. In a survey of 411 United States institutional investors, Fidelity Investments found that 47% of the participants believe that digital assets have a place in their investment portfolios.

The major attraction is the low correlation with other asset classes. Converesly, unclear regulation, lack of fundamentals, volatility, etc, were some of the hurdles in investing in digital assets.

Along with institutional involvement, mass adoption of cryptocurrencies is another important activity that can boost prices. In this regard, the markets are watching the development of Facebook’s rumored “FB Coin.” Sources have said the Wall Street Journal that Facebook is looking to raise $1 billion in investments for its cryptocurrency stablecoin. With Facebook’s mass reach, it can bring cryptocurrencies to the mainstream at a faster pace.

The recent recovery in Bitcoin has gathered pace and has pushed its market capitalization above $100 billion. Altcoins have also benefited from the bullish sentiment. After the rally, is it a good time to buy or to book profits? Let’s find out.

BTC/USD

Bitcoin (BTC) has surged towards its overhead resistance of $5,900. We like the pickup in momentum. This suggests confidence among the bulls that the leading digital currency will extend its recovery. If the price scales above $5,900, it will be a major sentiment booster. There is a minor psychological resistance at $6,000 but we expect it to be crossed. The next level to watch is $6,480.54. We expect the zone between $6,000–$6,480.54 to offer a stiff resistance. Hence, the traders can tighten their stops to protect their paper profits.

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BTC/USD

Contrary to our bullish view, if the BTC/USD pair fails to sustain above $5,900, it can witness profit booking that can drag it to the 20-day EMA. The pair might also enter into a consolidation between $4,914.11 and $5,900 for a few days. The trend will turn negative on a breakdown of $4,914.11. Until then, the bulls will continue to buy the dips. Traders can trail the stops on the remaining long positions to $5,400.

Currently, both the moving averages are sloping up and the RSI is also trying to break out of the negative divergence. This is a bullish sign. It shows that the path of least resistance is to the upside.

ETH/USD

Ethereum (ETH) has broken out of the downtrend line. It is currently facing resistance at the $180–$190.54 zone. If the bulls scale this zone, the digital currency can rally to $225 and above it to $256. Traders can buy above $192 and keep an initial stop loss of $146. As the risk to reward ratio is not very attractive, the position size can be about 40% of usual. We will suggest to trail the stops higher at the first available opportunity.

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ETH/USD

Our bullish view will be invalidated if the ETH/USD pair fails to ascend the overhead resistance zone and breaks below $148. Currently, the 20-day EMA is starting to turn up and the RSI has risen into positive territory. This suggests that the bulls have a minor advantage in the short term. The next couple of days are critical as it will set the stage for the next leg of the sustained move.

XRP/USD

While most major cryptocurrencies are on fire, Ripple (XRP) continues to lag behind. It is still trading below the 20-day EMA and close to the lower end of the range. This suggests a lack of interest among the bulls.

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XRP/USD

The XRP/USD pair needs to break out of the moving averages and $0.33108 to signal some buying. If the follow up buying pushes the price above $0.37835, we expect the pair to pick up momentum.

On the other hand, if the digital currency fails to move up, the bears will again try to break down of the critical support at $0.27795. We will wait for the breakout above $0.33108 to sustain before suggesting a long position.

BCH/USD

Bitcoin Cash (BCH) has broken out of the downtrend line, which is a positive sign. The 20-day EMA is gradually turning up and the RSI has risen into positive territory. This shows that the bulls have the upper hand.

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BCH/USD

The BCH/USD pair can now move up to $335.62 and above it to $363.30. We expect this level to act as a stiff resistance. If the price turns down from one of these resistance levels, the pair will trade in a range for a few days.

Our bullish view will be invalidated if the digital currency fails to sustain above the downtrend line and slips back to $255. The trend will turn negative on a breakdown of $225.

LTC/USD

Litecoin (LTC) has broken out of the 20-day EMA, which is a positive sign. It can now rally to $84.3439 and above it to $91. The digital currency has formed a cup and handle formation that will complete on a breakout and close (UTC time frame) above $91. This pattern has a target objective of $158.91. Traders can wait for the price to close above $91 to attempt this trade. The stop loss for this trade can be kept at $66 initially, which can be raised later.

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LTC/USD

But if the LTC/USD pair fails to climb the overhead resistances, it might remain range bound for a few days. The 20-day EMA is flat and the RSI is just above the midpoint. This suggests range-bound trading action in the short term. The trend will turn bearish on a breakdown and close below the recent lows of $66.470. It is always better to wait for the pattern to complete to go long, instead of buying in anticipation.

EOS/USD

EOS has broken out of the downtrend line and the 20-day EMA. This suggests that the recent pullback is over and it will now march toward $6.0726 and above it $6.8299. The 20-day EMA is gradually turning up and the RSI has jumped into positive territory. This shows that the bulls have the advantage in the short term.

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EOS/USD

Nonetheless, if the bulls fail to sustain the current levels, it will indicate profit booking that can drag the EOS/USD pair back to the 20-day EMA. A breakdown of the uptrend line will complete a rising wedge pattern and shift the advantage to the bears. Until then, any dip towards the 20-day EMA can be used as a buying opportunity.

BNB/USD

Binance Coin (BNB) rose above the previous intraday lifetime high of $26.4732350 and made a new high at $26.6428765. However, the bulls could not sustain the new high and the price has retreated back below it.

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BNB/USD

This shows profit booking at higher levels, but if the bears fail to sink the BNB/USD pair below the 20-day EMA, we anticipate another attempt by the bulls to make a new high. Both the moving averages are trending up and the RSI is in positive territory. This suggests that the bulls are in command.

However, if the price plunges below the 20-day EMA, it can drop to the 50-day SMA. A breakdown of this support will signal a deeper correction. We remain bullish and on the lookout for a reliable pattern that offers an attractive risk to reward ratio.

XLM/USD

Stellar (XLM) again broke below the uptrend line but found buyers at lower levels. While the repeated breach of a support line weakens it, the bears have not been able to sustain the price below the uptrend line. A breakdown of $0.09478125 can sink the digital currency to $0.08.

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XLM/USD

But, if the XLM/USD pair breaks out of the moving averages, it can rise to $0.12039489 and above it to $0.13250273. Currently, both the moving averages are flat and the RSI is just below 50. This points to a possible consolidation in the short term. We do not find any reliable buy setup, hence, we are not suggesting a long position in it.

ADA/USD

Cardano (ADA) is trying to break out of the 20-day EMA and the downtrend line. If successful, it can move up to $0.082952 and above it to $0.094256. However, the flat 20-day EMA and the RSI close to the midpoint suggest that range-bound trading is probable.

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ADA/USD

If the ADA/USD pair turns down from the current levels or from one of the overhead resistances, it can remain range bound for a few days. It will turn negative on a breakdown of $0.063230.

The pair will complete a cup and handle formation if it closes (UTC time frame) above $0.094256. We will wait for the price to ascend $0.094256 before suggesting any long positions in it.

TRX/USD

Tron (TRX) has been attempting to break out of the moving averages. If the price sustains above it, it will move up to the next overhead resistance of $0.02815521. The bulls have broken out of this level previously, but have not been able to sustain the breakout.

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TRX/USD

If the TRX/USD pair breaks out of the overhead resistance once again, it will offer an opportunity to go long. The pair has been consolidating for the past nine months, which indicates that the ensuing breakout will show a big move. Therefore, we retain the buy recommendation given in the previous analysis.

Contrary to our assumption, if the cryptocurrency turns down from the current levels, it can correct to $0.02094452. A break of this level will sink it to the critical support of $0.01830.

Market data is provided by the HitBTC exchange. Charts for analysis are provided by TradingView.” data-reactid=”274″ type=”text”>Market data is provided by the HitBTC exchange. Charts for analysis are provided by TradingView.

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Dominant Bitcoin Slips on Monday, Drags Cryptocurrency Index Down $8.7 Billion

By CCN.com: Dominant crypto asset bitcoin sent fresh shivers through the rest of the cryptocurrency market with its latest plunge.The bitcoin-to-dollar exchange rate dropped as much as 2.66-percent on Monday to establish an intraday low towards $5,569.71. The move brought bitcoin’s total downside correction from its weekly high to 4.58-percent, wiping more than $3.5 billion…

Dominant Bitcoin Slips on Monday, Drags Cryptocurrency Index Down $8.7 Billion

By CCN.com: Dominant crypto asset bitcoin sent fresh shivers through the rest of the cryptocurrency market with its latest plunge.

The bitcoin-to-dollar exchange rate dropped as much as 2.66-percent on Monday to establish an intraday low towards $5,569.71. The move brought bitcoin’s total downside correction from its weekly high to 4.58-percent, wiping more than $3.5 billion on the way.

BITCOIN, BTC USD

BITCOIN PRICE WIPED OVER $3.5 BILLION OFF ITS SLATE THIS WEEK | SOURCE: COINMARKETCAP.COM

Other assets listed in the cryptocurrency index followed bitcoin’s sentiment. Ethereum, the second-largest crypto by market capitalization, lost a little over a billion dollar as its dollar-rate dropped 6.76 percent. Bitcoin Cash, bitcoin’s forked version and the fourth-largest crypto, too plunged by more than 11-percent. EOS, Litecoin, XRP, Binance Coin and the rest of the top assets also trended in negative territories, as shown in the CoinMarketCap listing below.

BITCOIN, LITECOIN, ETHEREUM, BITCOIN CASH, EOS, XRP, CARDANO

CRYPTOCURRENCY MARKET CAP PERFORMANCE IN PAST 24 HOURS | SOURCE: COINMARKETCAP.COM

Combined, bitcoin and the rest of the cryptocurrency market, which includes more than 2,100 assets, lost up to $8.7 billion from their weekly high.

Imminent Market Sentiment

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BITCOIN, BTC USD

BITCOIN PULLBACK COMING | SOURCE: COINBASE, TRADINGVIEW.COM

Read the full story on CCN.com.

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