New DeFi Contender Claims Superiority With P2P Atomic Swapping DEX

Republished By Plato

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Portal claims to be a ‘true’ decentralized cross-chain DEX in contrast to current cross-chain models.
This claim follows the half dozen cross-chain bridge hackings which collectively lost more than $1 billion.
Portal intends to create a DEX that embodies Bitcoin’s original intent of self-governance.

Portal, a cross-chain DEX built on Bitcoin, claims to have the technology to improve upon the currently-vulnerable cross-chain bridge model. This is in response to the several hacks that happened in the past months that put user funds at stake.

The Portal Atomic Swap has taken a different approach that introduces no centralization, wrapped tokens, or third-party custody. Instead, all transactions rely on a peer-to-peer approach. If the transaction encounters an issue, it can be rolled back and participants keep their original assets.

The removal of wrapped tokens or validators is a general quality of life feature when processing transactions. Additionally, the peer-to-peer aspect ensures there are no unexpected delays, blocked funds, exploits, or other drawbacks that cross-chain bridges have.

The issue at hand is that the current cross-chain bridge model is prone to security exploits. Hackers have exploited 5 bridges since mid-2021, obtaining more than $1 billion. In other words, the potential loss of funds is a serious threat to the decentralized finance (DeFi) industry.

Additionally, the second biggest DeFi hacking happened earlier this February at Wormhole. The mentioned incident saw losses of 120,000 Wrapped Ether (wETH) tokens valued at $375 million at Ether’s (ETH) current price. The effects were minimized by the hacker returning $600 million to PolyNetwork and Jumpy Crypto replacing the lost 120,000 ETH for Wormhole.

In a recent Reddit AMA, Ethereum Co-founder Vitalik Buterin himself expressed that he is pessimistic about cross-chain applications. Instead, Vitalik argues that the future is multi-chain because of the fundamental limits to the security of bridges.

Portal CEO Eric Martindale claims that these current cross-chain solutions are false “decentralized” DEXs.

The current centralized exchanges, false “decentralized” DEXs, custodially wrapped tokens, and censorable ecosystems all threaten Bitcoin’s promise of self-sovereignty. Fabric technology enables Layer 3 privacy on cross-chain transactions and eliminates the need for centralized custodians.

Instead, Portal aims to build a DEX that embodies Bitcoin’s original intent of self-governance. Martindale says Portal will bring a fast, peer-to-peer, Layer 2 exchange along with the speed of centralized exchange with privacy.

Time Stamp: February 17, 2022