The past few months have been exciting for Bitcoin and cryptocurrencies. In what many observers have compared to the cryptocurrency bull run of 2017, we saw that many cryptocurrencies have increased in volume, market capitalization, and prices. Satoshi’s dream of a possible alternative currency seems to have expanded into a reserve asset and a hedge against inflation.

Given the rapid growth of cryptocurrencies, there have been several considerations about the sustainability of cryptocurrencies as a reserve asset or currency. Questions about volatility, energy consumption and recently rising transaction fees in Bitcoin and Ethereum networks are often asked about cryptocurrencies. However, just like in the early days of the internet, blockchain networks continue to evolve by fixing some of these issues.

In January 2021, active Bitcoin wallets reached 22.3 million unique addresses, setting an all-time high. Without a doubt, the asset will attract interest from both long-term believers and new investors. In the past few years, we’ve also seen improvements and challenges in buying cryptocurrencies as the network continues to grow. One such innovation is the atom swap.

An atomic swap is an intelligent contract-based decentralized technology that allows users to swap various blockchain assets, with control of one user’s asset only being given up once they are certain that they are in control of the other asset. By the way, if you are unfamiliar with smart contracts, they are computer algorithms that run once certain preset conditions are met.

Invented by Tier Nolan in 2013, the technology was in limbo until 2017 when Litecoin founder Charlie Lee tweeted about a cross-chain atomic swap he was doing with LTC and BTC. Atom swaps have steadily improved since 2017 and offer a truly decentralized method for exchanging virtually any cryptocurrency.

As mentioned earlier in this article, Atomic Swaps use intelligent contract technology, in this case Hash Timelock Contracts (HTLC). HTLC is a timed smart contract that includes a cryptographic hash function generated by both parties who are ready to perform the exchange. In the case of an atomic exchange, cryptocurrencies from parties that are willing to exchange are blocked for the smart contracts. The inspection and transaction are subject to both parties and transactions will be voided if the time limit is not met.

Let’s look at this hypothetical scenario in less technical terms. Elon has 1 Bitcoin that he would like to exchange for the equivalent of Litecoins. Michael has these Litecoin equivalents. To start the atom swap, Elon creates an HTLC address and sends its transaction to the Bitcoin blockchain. At the same time, a cryptographic hash is generated to encrypt the transaction. Michael does the same on his end, and by exchanging keys for verification, the transaction will be completed within a set time frame, or it will be invalidated on both ends and the coins returned to their respective senders. No central company is ever in control of the two assets that are being exchanged.

In the past three to four years, the concept of atomic swaps has evolved, while basically maintaining the same principles and overall goals. At a time when centralized exchanges are struggling with significant trading fees, KYC verification, and potential hacks, atomic swaps offer a truly unique alternative to them.

Now Nimiq is offering one of the best crypto atom swaps in the business. Nimiq is a decentralized, censorship-resistant payment protocol that focuses on simplicity and ease of use. In less than 30 seconds, you can create a self-managed Nimiq wallet and then buy BTC and NIM directly in the wallet via bank transfer. With Nimiq, up to 350 million users in Europe can now easily get on board from EUR to BTC and NIM with just one SEPA Instant-enabled bank account. In just five minutes, with no installation or registration, and with just 1.25% fees (plus blockchain network fees, which are close to zero for NIM).

Nimiq stands out for being the pioneer of fiat smart contracts, allowing users to atomic exchanges between fiat and crypto with the same simplicity. The open source project also allows developers to participate in the journey and ultimately aims to make a significant contribution to the idea of ​​a decentralized world. The multiple potentials in Nimiq set a precedent that would make nuclear swaps popular in the years to come.