I was on LeoThreads yesterday when I came across a thread by onealfa.leo mentioning about Houdini Swap. It was my first time to hear about it and curious, I immediately went to check it out. And thought I'd share what I found out on my research.
What is Houdini Swap
Houdini Swap is a non-custodial swap platform that allows users to quickly and easily anonymize blockchain transactions. It enables users to break all on-chain links between sending and receiving wallets by utilizing Monero as a “tunnel” between exchanges. It allows users to maintain privacy on the blockchain, offering a regulatory compliant anonymization service for Web3 participants. (Source)
"It's a privacy service that anonymizes cryptocurrency transactions. It invented the “conduit system." (Gitbook)
It is one of the projects that was incubated by Dream Labs. The platform was founded by Lou Waroo and was launched in July 2022.
It is an aggregator of non-custodial exchanges that uses the Monero blockchain to anonymize transactions. (Source)
Simply put, it makes transactions 'private' or anonymous. I think it could be handy especially if you want to send assets to a wallet that you don't want to be linked or traced with your known wallet.
I quote what's stated on the platform, re:
After performing a HoudiniSwap, there will be no traceable connection between the sending wallet and receiving wallet. Poof, your crypto is anonymous. (Quoted)
According to its Whitepaper, Houdini Swap is a fully compliant platform for anonymity and enumerated the following reasons, re:
- It never holds custody of user funds.
- It is not a market maker nor has liquidity pools.
- It never accepts payments from users.
- It never utilizes a mixing wallet.
- It never requires user accounts.
- Houdini Swap isn't a mixer. It is an automated conduit between exchanges. The legal risk sits with the exchange, not Houdini Swap.
Source: Whitepaper
Houdini Swap’s mission is to bridge the disconnect between the public nature of blockchains with the individual’s inherent right to both privacy and personal financial security. There is sound logic for why digital fiat systems such as bank accounts and credit card transactions are not public to all onlookers; privacy is a core element of security. The public nature of blockchains leaves people vulnerable to risks ranging from phishing scams to violence. (Source)
Notable Info
Over $55M in total swap volume and more than 22k swaps made as of 30th May 2023.
They do Magic Mondays on Twitter Spaces where they give updates on what happened during the week. Check the 24th edition here. They also post Weekly Swap Reports on Houdini Swap's Twitter account.
They onboarded over 5 exchange partners, details of which are unknown though.
40+ tokens supported as of 18th May 2023.
(src)
On 23rd May 2023, Theia Blockchain, the institutional VC Fund invested $250K to support Huodini Swap. (src)
Fees
Apparently, the platform doesn't charge any fees. But they earn commission from their non-KYC liquidity partners which charges an average of 2% per anonymous swap. Of that 2%, their liquidity partners provide an affiliate commission back to Houdini Swap of approximately 0.45%.
Average 0.2% to 0.4% fees for non-anonymous swaps, depending on which liquidity partner a swap is routed through.
All funds generated by these affiliate commissions are sent a single wallet which is used to buy back $POOF on the open market.
Source: Houdini Gitbook
POOF Token & Its Utility
$POOF is Houdini Swap's Native Token (ERC-20) which powers the Houdini Swap Loyalty Program.
Max Supply: 110M
Can be traded on UniSwap V2
Utilities:
- Staking $POOF to earn APY. Variable staking periods, re: 30, 60, 90 and 180 days.
- Swap and earn back swap fees by attaching the Account ID on every transaction.
- Refer others through their referral ID and earn commissions on other people's swaps.
Contract Address: 0x888cea2bbdd5d47a4032cf63668d7525c74af57a
Tokenomics
- Buy Backs
"Revenue generated from the swap commissions (0.45% per swap) are collected weekly and fund a wallet used for $POOF buybacks. Using an automated buy bot, Houdini Swap buy $POOF on the open market. These $POOF funds are never released back into open circulation, effectively creating a burn wallet." (Quoted)
Sources: Houdini Gitbook / Whitepaper
Quick Guide: How to Swap
Choose the crypto swap pair.
Choose between any combination of cryptos. There is no need to connect any wallet to the platform. You can toggle the options whether to do an Anonymous swap or Non-Anonymous, can also choose whether you want to send an exact amount.Input the amount to swap.
Wait while HoudiniSwap gathers rates from multiple exchanges before the calculated amount shows up. In below example, sending 1 BNB from one wallet to another on the same chain (BNB Chain/BEP-20), 0.9863 BNB will be credited to the receiving wallet. So the fee is 0.0137 BNB which is about $3+ in today's rate.
Input the receiving wallet address.
The receiving wallet address should match the address format of the receiving currency.Send funds to address generated.
Open your personal wallet and manually send the exact amount of funds to the address indicated on the Order Page. There's a timer on the order page and you must complete and send the token to the address before it expires.
Accordingly, it takes 20-minutes for a swap to complete. You can follow along progress on the Order Page.
Personal Thoughts
Houdini is an interesting application or platform and with the volume of swaps it has processed, it shows that crypto users are appreciating the anonymity that it provides. Whilst the fees might be more than when one uses the direct method of sending from one wallet to another, the privacy that this swap service offers can't be ignored.
I'm personally interested to see how this project progresses, develops and whether it will gain more popularity in the crypto space.
Meanwhile, there's an ongoing campaign on Zealy if anyone is interested to check it out. Here's an invite link. There's a prize pool of $50k.
Disclaimer: For infotainment only. This is not an endorsement of the service. DYOR
Lead image created on Canva. Logo/s from Houdini. No copyright infringement intended. 05072023/09:15ph