Q: How do you handle the "free option" problem?

A: The "free option" problem is when the counterparty in a cross chain atomic swap has the ability to wait for some length of time before deciding whether or not to send their funds.

In SIBEX there are always only two parties to a trade: the "Initiator" and the "Participant". Who sends their funds first? In SIBEX, the parties to the trade decide this randomly. In some trades you will be the Initiator, in some you will be the Participant. When the Initiator sends their funds, the trade has started. Now, the Participant must send their funds.

It is of course impossible to force the Participant to send their funds  
Nobody has access to the Participant's funds except the Participant! But it is in the best interest of both parties to send their funds as quickly as possible, in order to achieve the fastest possible settlement time and free up their available funds. That's exactly what using SIBEX software helps you to do. When both parties are operating sibexd (the SIBEX client daemon) in a professionally managed cloud environment, like AWS, the likelihood that this swap fails due to one of the parties unintentionally going offline becomes very small. That's one big reason why we've developed a simple AWS Cloudformation script for you to use. 

Additionally, the SIBEX Trading Interface is designed to prevent users from entering into a trade and then bailing out. Once you've committed to a trade, you're in it until it completes. This removes access to the "free option" for 99% of users.

But what about a sophisticated user, who is operating sibexd on their own hardware, and controlling their trades using the sibexd API? Can't this person take advantage of this "free option"? Yes. 

Users can always move their funds "out from under" their SIBEX client, even if they are in the middle of a trade. However, this is again where License Keys are helpful. At this embryonic stage of the SIBEX network's development this is not an issue, as most people are happy just to try trading BTC/USDT completely P2P! If this becomes a problem in the future, we can always try to find out who is doing this, and then revoke their License Key so they cannot continue to abuse the network.

Eventually, we'd like to turn the "free option problem" into a "tradeable option". But that's something for the future.