A crosschain transaction allows for the trading of digital assets between separate blockchains using smart contracts. It is also known as an atomic swap.
Most blockchains have their own cryptocurrency and will insist that transactions happen in that currency. Sometimes you must convert from one crypto to another and also use multiple exchanges to be able to make a specific purchase or trade. This is time-consuming, confusing, and unfriendly.
What does a crosschain transaction look like?
You own a BlobNFT on one blockchain and would like to swap it for YukNFT. However, the YukNFT you want is on a different blockchain. What you need is a straightforward way to make this crosschain transaction.
Enter the atomic swap. You and the YukNFT owner agree that your NFT is worth two of their NFTs. A smart contract executes the trade, and the deal is done. It cannot be reversed.
The technology to enable crosschain transactions easily is still new. NFTrade is one marketplace that facilitates ‘swaps’ on their site.