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In TeleSwap, users have the ability to instantly exchange BTC for other tokens. To initiate this process, users are required to lock collateral on the Polygon network. Once the collateral is locked, users can leverage the Teleportation mechanism to instantly acquire teleBTC tokens. These teleBTC tokens can then be readily exchanged for the desired token within the TeleSwap platform.
The instant cross-chain exchange process bears similarities to the instant cross-chain transfer, with the inclusion of additional exchange-related information within the loan request. In the loan request, the user specifies essential details such as the exchange token address and the minimum expected amount. Following this, the TeleSwap contract verifies whether the user has locked sufficient collateral and proceeds to borrow the desired teleBTC tokens from the instant pool on behalf of the user. Once the tokens are borrowed, they are promptly exchanged utilizing the designated DEX as specified by the user. The resulting exchanged tokens are then swiftly sent to the user.
Now the user is granted a limited timeframe to repay the instant loan. To facilitate the repayment, the user can automatically initiate a repayment request by sending the required funds on Bitcoin. It is crucial for the user to repay the loan within the predetermined timeframe. Failure to do so will result in the user's collateral being slashed, similar to the consequences described in the instant cross-chain transfer process.