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OdinTrade: Trustless Cross-Chain Settlement Mechanism

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Overview

OdinTrade is a decentralized, trustless cross-chain settlement protocol that enables atomic swaps between Bitcoin and EVM-compatible blockchains, starting with Ethereum. It leverages an extended Hashed Time-Locked Contract (HTLC) method to facilitate secure, efficient, and user-friendly asset exchanges without requiring intermediaries.

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How It Works

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1. Swap Initialization

  1. User Requests Swap: A user requests a price quote from the Liquidity Node.
  2. Liquidity Node Generates Secret: The node generates a cryptographically secure random secret (SECRET_X) and its hash (HASH(SECRET_X)).
  3. Pre-Signed Claim: The user receives a pre-signed claim transaction (UserClaimToSign), ensuring smooth execution.

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2. HTLC Deployment

  • Liquidity Node Locks Funds: The node creates an HTLC on ChainOut with HASH(SECRET_X), AmountOut, and LOCKTIME_1.
  • User Locks Funds: The user creates an HTLC on ChainIn with matching parameters, ensuring atomicity.

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3. Claim Process

  • Liquidity Node Claims on ChainIn: The node submits SECRET_X to claim TOKEN_IN from the Bitcoin contract.
  • User Claims on ChainOut: Once SECRET_X is revealed, user claim will be managed by the Liquidity Node thanks to the pre-signed claim transaction of the User. The User in any case can claim the funds on ChainOut since the Secret is stored on the ChainIn HTLC.
  • Automatic Fallback: If unclaimed, assets revert to their original owners after the locktime expires.

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Key Features

  • Trustless Atomic Swaps: No reliance on third-party intermediaries.
  • Pre-Signed Transactions: Reduces user interactions while maintaining security.
  • Secure Locktime Mechanism: Ensures atomic execution and prevents fund loss.
  • Cross-Chain Compatibility: Supports Bitcoin (UTXO) and Ethereum (Account-based).
  • Efficient Liquidity Access: Sourced from Centralized Exchanges (CEXs) to provide competitive pricing.
  • Seamless Integration: SDKs and APIs for wallets, DEXs, and DeFi applications.
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