Trustless Atomic Swaps

Trustless atomic swaps allow users to on- and off-ramp between Citrea and Bitcoin without using the peg mechanism. They are being actively implemented through third parties and live on Citrea Testnet, such as Citrex and Garden Finance.

A very basic atomic swap works as follows:

• A smart contract on Citrea is used to lock some amount of cBTC. This smart contract also utilizes BitcoinLightClient on Citrea to verify Bitcoin transactions on chain (see below).

• User A locks some cBTC into the smart contract, and demands an equivalent amount of Bitcoin in return.

• Some User B sees the request, and locks the equivalent amount of Bitcoin into the desired address of User A in the Bitcoin network.

• Upon finalization of the transaction, user B can then submit the transaction details to the Atomic Swap smart contract on Citrea, which verifies the transaction and lets user B to claim the locked cBTC.

Here's a basic diagram of the process:

Basic Atomic Swap Diagram