PeerSwap

• Name: PeerSwap
• URL: https://www.peerswap.dev/
• Category: Lightning channel-balancing protocol / direct-peer atomic swap infrastructure / Bitcoin-and-Liquid liquidity-management tooling
• Tags: bitcoin-ecosystem
• Summary: PeerSwap is a direct-peer channel-balancing protocol, not a hosted swap venue. The important part is that liquidity management stays between existing Lightning peers: custom-message negotiation, explicit swap state, and BTC or L-BTC settlement against channel balances, instead of outsourcing the job to a marketplace, coordinator, or wallet wrapper.
• What it does:
  • Lets direct Lightning peers perform atomic swaps between onchain assets and Lightning channel liquidity to rebalance existing channels
  • Supports both swap-in and swap-out flows so an operator can move channel balance toward either side depending on inbound or outbound liquidity needs
  • Works with both Core Lightning and LND, either as a CLN plugin or as a standalone daemon/CLI paired with LND
  • Supports Bitcoin and Liquid, with the project explicitly emphasizing L-BTC swaps as faster, more private, and less exposed to mainchain fee spikes
  • Uses a published peer-protocol draft with JSON payloads over Lightning custom messages, plus explicit swap identifiers, protocol versions, and opening/claim transaction rules
  • Keeps swaps limited to allowlisted direct peers in the current beta-stage operating model rather than presenting itself as an open marketplace for arbitrary counterparties
• Key claims:
  • The official site says PeerSwap enables Lightning nodes to balance channels through atomic swaps with direct peers and frames the product as a way for nodes to be their own swap provider without a centralized coordinator
  • The main README calls the software beta-grade, says it can run as a Core Lightning plugin or standalone daemon/CLI with LND, and notes that swaps are currently only allowed with allowlisted peers because a production fee model is not yet proven
  • The README says PeerSwap supports two swap types: swap-in for trading an onchain asset into Lightning outbound liquidity and swap-out for trading an onchain asset into Lightning inbound liquidity
  • The README and site both repeatedly argue that direct-peer balancing is more reliable and lower-cost than multi-hop circular rebalancing because operators are not guessing about third-party channel state or paying coordinator rent
  • The README says the project currently supports both Bitcoin and Liquid and explicitly highlights L-BTC swaps as often the most compelling mode because they are faster, more private, and do not touch Bitcoin mainchain blockspace during high-fee periods
  • The peer-protocol draft says PeerSwap uses Lightning custom messages in the 42069-42085 range with JSON-encoded payloads and currently sets protocol_version to 5, which shows the project is publishing a reimplementable interoperability surface rather than only shipping one opaque daemon
  • That same protocol document defines one active swap per channel, unique swap_id handling, maker/taker roles, and concrete opening/claim transaction paths, reinforcing that PeerSwap is an operational liquidity protocol rather than just a UX feature
  • The project README says an interoperable second implementation and discussions toward the next protocol upgrade are underway, which is a strong sign that the team sees PeerSwap as broader protocol infrastructure, not merely one node plugin
• Whitepaper: No canonical standalone PeerSwap whitepaper or litepaper surfaced in this pass. The clearest current sources of truth were the official site, the main repository README, and the published peer-protocol draft; see ../whitepapers/peerswap-primary-sources-2026-05-03.md.
• Sources:
  • https://www.peerswap.dev/
  • https://github.com/ElementsProject/peerswap
  • https://raw.githubusercontent.com/ElementsProject/peerswap/master/README.md
  • https://raw.githubusercontent.com/ElementsProject/peerswap/master/docs/peer-protocol.md

Internal linkages

• Hosted swap and rebalancing contrast: boltz

• Provider-sold liquidity contrast where the operator buys inbound capacity instead of swapping directly with a peer: blocktank

• Node dashboard that packages PeerSwap as one feature inside a broader operator cockpit: ride-the-lightning

• Last reviewed: 2026-05-28 UTC