The Liquality Multi-Chain Swap Wallet: Cross-chain Atomic Swaps Have Never Been So Easy
Edit: Liquality Atomic Swaps are live for users to swap crypto p2p.
Try out our products on mainnet:
Today, the Liquality team is excited to release the Alpha version of our multi-chain wallet! The Liquality wallet is the easiest way to swap across blockchains. Download the Liquality wallet here and try it out on testnet. Join the Liquality community on Telegram. You can DM us on Twitter if you need rinkeby eth or testnet btc.
What’s so great about the Liquality multi-chain wallet?
- Simplified cross-chain swaps: it only takes three clicks to complete a swap, everything else is done by the wallet in the background. No need to have any other tokens to swap, and there are no added fees. This is, by far, the easiest and most secure way to swap across blockchains (currently BTC, ETH, DAI, USDC, USDT, WBTC as of 2020-08-05).
- Multi-chain: for this release, you can hold, send, receive and swap on the Bitcoin and Ethereum chains.
- Send to any wallet: you can start a swap inside the Liquality wallet and send it directly to a different wallet, all in one click.
- No KYC: the only onboarding needed is saving your seed phrase, setting a wallet password and you’re ready to go. No KYC for peer-to-peer swaps.
- Secure: your private key is never exposed - it lives in your Chrome extension, away from any browser malware. Safety of funds is our primary concern.
- Full control: as with anything in Liquality, you maintain full control of your assets. We have no way of accessing your funds and we are not a part of any transaction you make.
- Extensible integration: developers can integrate, extend, and contribute to any of our open-source initiatives to avoid vendor-lock in. We encourage public review and collaboration.
NOTE: This is an Alpha release, and we have set the default to be testnets (rinkeby and bitcoin testnet) for now. Although our contracts have been audited, the wallet automation as well as the extension interactions have not, and this wallet is still immature. Test the wallet out with testnet swaps thoroughly and give us feedback.
How Did We Get Here?
Learning through user insights.
At Liquality, we strive to build what our users want and ask for. We are always looking to tighten the feedback loop on our product development through constantly validating interest and usability of our products.
Our first mainnet release, in June 2019, offered cross-chain atomic swap settlement without discovery. Users had to find each other on external platforms (e.g. OTC desks, Telegram, etc.), negotiate a price, and use Liquality to avoid counterparty risk. Although this service saw some modest usage, it was clear that finding a counterparty was too much of a burden when wanting to swap. Users were asking for available liquidity.
Since our release of the Atomic Swap Interface in April, which provide available liquidity to the network, we have seen significant growth. There have been over $780k in total swaps in the past 8 weeks, with returning users swapping larger volumes as they get comfortable with our double-sided escrow atomic swap model.
From talking to users, we know that the biggest friction points in our current swap experience are:
- The need to be online through the whole swap in order to do a manual claim
- The need to have a Ledger for Bitcoin and the multi-step process to connect a Ledger device
- The speed of cross-chain swaps due to Bitcoin block times
By offering a secure browser extension wallet that automates the cross-chain swap process, we eliminate manual claiming and the need for a Ledger (Ledger users can still swap using our browser UI), while also reducing the importance of long block times since swaps are completed in the background.
How Does The Wallet Work?
The wallet is built using two of Liquality’s core open-source components - the Chain Abstraction Layer (CAL), and an automated wallet bot.
- The CAL is an open-source modular library that simplifies cross blockchain development, which projects like Atomic Loans are using to expand the cross-chain ecosystem. The CAL is built on standards for Hashed Time Locked Contracts (HTLCs), which allow for the removal of counterparty risk when exchanging through double-sided escrows. It also utilizes user-owned-and-deployed, disposable smart contracts instead of a centrally controlled smart contract to protect users’ security, privacy and efficiency.
- The wallet bot removes the need for interactivity in cross-chain swaps by automating away all the steps needed to complete a swap. HTLC-based swaps remain slow due to block times and multiple transactions, but the agent moves all of those concerns to the background to allow for a smooth user experience. The wallet bot so far has been a crucial piece in enabling liquidity providers to always be online for users to swap with, and now we’ve turned it around so users can take full advantage of this functionality.
Security
The current implementation uses extension's localStorage to store the AES-256 encrypted seed phrase & wallet metadata like transaction history & addresses.
In upcoming releases, we are planning to move to browser.storage.local as the primary data store for the extension.
Risks
Here are some of the risks you should be aware before using the Liquality wallet:
- Smart contract: Liquality contracts have been audited, use battle-tested standards, and have been architected as user owned and deployed contracts, which make it more secure, private and efficient than centrally controlled smart contracts. These contracts have facilitated close to $800k in swaps to date. There is also no central honeypot contract, which makes it less attractive to hackers. That being said, there is a risk of unknown attack vectors.
- New unaudited, tested, extension code: Although our contracts have been audited, the wallet automation as well as the extension interactions have not. We are planning an audit for these components, and have built extensive tests for these modules. We recommend you test the wallet out with testnet swaps
- Phishing attacks: your private keys are separated from the browser, so no one but you can access them, and your wallet is password protected. However, if someone gets a hold of your password, they would be able to access your wallet. This is common across all browser extensions.
- Browser monitoring: Liquality doesn’t have access to any of your information, but Chrome could monitor your browser interactions. Chrome won’t have access to your private key, but it may collect information about when and how you use the app.
- Node dependency: The Liquality wallet utilizes Infura (Ethereum) and Blockstream (Bitcoin) to broadcast transactions to each chain. Users who want to connect to their own nodes can download and run their own swap interface.
What’s Next?
A World Of Interoperability
We have a lot planned for the cross-chain wallet! Here are some of the requested features you can expect in the coming months:
- Funding a swap from any wallet
- Wallet back-up, export
- Easily managing (send, receive) any ERC-20 from your wallet
- Easily providing liquidity to Liquality from your wallet
- Gas / Fee customization
- USD conversion
- Injectable Bitcoin, bringing Bitcoin to any dapp
- More chains and tokens available to swap
- Access to an ecosystem of cross-chain applications
- Mobile wallet
- Integration into cross-chain DeFi applications
As well as fixed known issues like:
- Back button inconsistencies
- Transactional data maintained within the application and not recovered from the blockchain
- Performance degradation
- Show whole address when confirming a send / receive / swap
- Automatically updating balances
Download the Liquality wallet here and try it out on testnet. Join the Liquality community on Telegram. You can DM us on Twitter if you need rinkeby eth or testnet btc.