Technical Overview
Consider two blockchains, A and B, with assets a and b respectively. A user intends to swap x amount of asset a for y amount of asset b. The process involves:
Locking: x assets are locked in a smart contract on Chain A.
Minting/Burning: The locked assets are converted into Pairs tokens, which are then burned in exchange for stablecoins. These stablecoins are bridged to Chain B.
Conversion and Unlocking: On Chain B, the stablecoins are used to purchase y assets of type b, which are then credited to the user's wallet. This ensures the conservation of value across the swap.
Conservation of Value: The process guarantees that the value locked on Chain A is equivalent to the value unlocked on Chain B, adhering to the formula
V(a,x)=V(b,y)
, where V represents the value of the assets, ensuring the swap is equitable.
This mechanism facilitates seamless cross-chain swaps by leveraging Pairs tokens as an intermediary, optimizing for both security and efficiency in the transfer of value between different blockchain ecosystems.