Thanks MPOE-PR. You're are right that I have much much more to read (and unfortunately I'm already renowned among my friends for writing too much - sorry).

It's interesting that you picked out that particular line and in following the link that you kindly posted, I see that you've made some interesting points on WoT, something I only vaguely recall having heard about before.

The point of my original post was to describe the exchange algorithm and started off from the *premise* (which, in retrospect, perhaps I should have highlighted) that Alice and Bob had *already* reached the point at which they had attained at least some provisional level of trust in each other albeit still subject to agreement of terms (Step 0.0), principally the amount of collateral and the expiry time.

The algorithm itself aims to make it such that both parties have 'skin in the game' in an attempt to acceptably minimise each person's residual risk in that particular exchange and regardless of how many exchanges they had previously carried out with however many other people (or even with each other).

I do need to (and will) read more, especially all the learned content regarding trust; I hope you don't mind me raising questions/comments on that subject elsewhere in the forum, possibly in the thread that you pointed me to.

Thanks again for helping out a newbie with your enlightening post. :-)