Define “Atomic Swap” and Its Role in Trustless Cross-Chain Trading

An atomic swap is a technology that allows two parties to directly exchange two different cryptocurrencies on two separate blockchain networks without the need for a trusted third-party intermediary or exchange. It uses hash time-locked contracts (HTLCs) to ensure that either both transactions occur simultaneously, or neither occurs.

This provides a mechanism for trustless, cross-chain trading, which is vital for expanding the liquidity and utility of decentralized derivatives across multiple chains.