Countless exchanges have been hacked throughout the years, so here we are going a decentralized world and we have to rely on centralized authorities to facilitate cross-chain trades. A solution for facilitating over-the-counter(OTC) trades without the risk of getting scammed or a single point of failure was to incorporate Chainlink oracles to retrieve data with the use of Honeycomb's APIs and nodes to create HoneyDex.
What it does
HoneyDex allows for two users who do not need to trust each to achieve interoperability between Ethereum and Bitcoin, enabling decentralised and trustless OTC.
How I built it
The idea to use Honeycomb's nodes and APIs to achieve interoperability trades gave rise to this new application. A user will create a new agreement between another users with regards to a trade of ETH/BTC. This agreement will contain all the necessary details such as both parties BTC and ETH Addresses, Amounts to Sell of each currency, the nodes and job id's that need to be called to request information. Once the agreement is created the Ethereum to be traded is locked in the contract until the agreed amount of BTC is transferred to the seller's wallet. Once it is transferred any user can deposit LINK tokens into the contract and request confirmations to actually validate if such a transaction went through and if it is accurate, this validation will be performed by multiple different nodes to ensure true decentralization. The nodes use the transaction hash of the trade performed together with the BTC address of the BTC buyer to confirm that the exact amount was sent, if the exact amount was sent then ETH can be released and sent to the ETH buyer. This smart contract also comes with the ability to retrieve the ETH and BTC prices using strictly decentralized data to provide the users a comparison of trade and market price.
Challenges I ran into
The hardest challenge with regards to this hackathon was figuring out an efficient way to retrieve and validate the information but the ease of use of Honeycomb's APIs and nodes proved to bring great advantage.
Accomplishments that I'm proud of
Creating the first decentralized Trust-less P2P ETH to BTC trading platform using chainlink.
What I learned
I learned the great advantage of using pre-made API's and nodes. I could focus more on the development of my application instead of wasting time setting up nodes and API's.
What's next for HoneyDex
HoneyDex will become a full fledged cross-chain decentralized exchange with order matching something in the likes of EtherDelta but with any publicly verifiable blockchain transactions.