Atomic Swaps, and what they mean for cryptocurrencies

Everyone who is interested in cryptocurrencies knows that there is a major scaling debate between Segwit, and increasing the block size for each block mined in the bitcoin chain. What they may not be familiar with is what segwit unlocks, and what that unlocking means for two other cryptocurrencies. We just have gotten segwit2x locked in and that means atomic swaps will come soon.

Segwit explained
First, segwit (segregated witness) allows for off chain transactions in the form of payment channels to be made. These off chain transactions leap frog each other by creating smart contracts with a future expiration date, and the ones making the transaction are always the ones who do not have an incentive to cheat the system. That is to say, if you are a cheater, you will lose money, based on the timelocking mechanism. This allows cryptocurrencies to be swapped off chain, but it also unlocks something else-

Atomic swaps
Now, what do atomic swaps do? They allow one cryptocurrency to be swapped at the market rate with another cryptocurrency without an exchange. This is huge, because now it does not matter if you hold an altcoin, and you want to buy from someone who only accepts bitcoin. The atomic swap will automatically replace the value in the altcoin with the value in bitcoin. To you the buyer, it will appear as if you are paying in the altcoin, and to the seller it will appear as if you are paying in bitcoin. In reality, the atomic swap is this magical real time broker that settles value and cost. Only cryptocurrencies that already have segwit enabled can enable atomic swaps. This will slowly equalize the market caps on each of the coins by what they bring to the table, not by how much hype they have.

The Experiment and the proof
Litecoin is the furthest along with implementing atomic swaps with another partner- vertcoin. Here is what you need to watch for. At the time of this writing, vertcoin is $.5 it also has a circulating supply of 37,083,947. Litecoin is $40 with a circulating supply of 52,165,332. Vertcoin should by these numbers be worth $56. Once litecoin and vertcoin have atomic swaps enabled, vertcoin's value will rise, along with a corresponding fall in the price of litecoin at exactly 71% of the rise in vertcoin over the period that atomic swaps are active for. If this occurs, you can make a safe bet that once bitcoin enables atomic swaps, its main trading partner litecoin and by extension vertcoin will increase in value to be of a similar total market cap value modified by the number of people who accept bitcoin (demand). This will decrease volatility in the long term.

The long term
Atomic swaps will do one of two things to bitcoin. They will decrease the price and make bitcoin spendable in places it normally cannot be spent, like places that only take ethereum (icos) or monero (dark web). The alternative is that atomic swaps will do nothing to the price of bitcoin as name brand recognition keeps value consolidated in bitcoin. It really depends on the outcome of the litecoin-vertcoin experiment. However, either outcome will see mainstream crypto adoption takeoff as other blockchains like eos and ether start to write all businesses to their own chains. By having atomic swaps, bitcoin will default to the settlement layer, with other currencies coming to bitcoin to arbitrate big transactions. This is good for bitcoin in the long term, and will more than make up for the short term loss in value.

You motherfuckers say you wanted pictures. So I pulled a melissa mccarthy imitating sean spicer and googled some motherfucking pictures. If you need visual aids to understand maths and economy shit and crypto, god help you, you are one lucky motherfucker. How did you survive to stumble into bitcoin? You could have been sold a bridge by some shady construction agency for you to live under.