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Trade Negotiation Protocol
Hart Lambur edited this page Aug 20, 2018
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The following spec outlines the requirements for the trade negotiation protocol that allows two counterparties (a taker and maker) to trustlessly negotiate and enter into a contract.
Requirements:
- The taker must be able to prove they have the necessary capital (margin) to enter the trade.
- The maker must also be able to prove they have the necessary capital (margin) to enter the trade.
- The "wire time" offered by the maker must be held (at least subject to some reasonable conditions).
- Their must be surety that both counterparties will fund the trade and transfer their initial margin if the trade is "done".
Undecided design questions:
- Is there a penalty for a taker not trading? (Do we need such a penalty to exist to prevent a taker from being a spiv and looking to pick off makers)?
"Optional" or "Nice to Have" Features:
- AML/KYC for traders. Check out Wrye.
- Swap Protocol outline and whitepaper.
- Worth reading the outline for the AirSwap Conversation OTC Interface