The DLC Specification outlines contract negotiation in a simple 4 step process. This assumes both parties are already matched or familiar with each other and are both running nodes.
+-------+ +-------+
| | | |
| |---- (1) offer --->| |
| | | |
| |<--- (2) accept ----| |
| A | | B |
| |---- (3) sign --->| |
| | | |
| | | (4) broadcast fund-tx
| | | |
+-------+ +-------+
- where node A is 'offerer' and node B is 'accepter'
Contract negotiation within the DLC Market is a 6 step process that assumes both parties have no knowledge of the other and one party is running a DLC Node.
Specifically, this DLC transport daemon is designed with the assumption that the market maker is running a node, while the taker is a client.
It uses an IRC channel for broadcasting Order Offers and IRC private message for receiving Order Accepts which allows both parties to agree to contract terms before revealing funding inputs and commencing signature generation.
+-------+ +---------------+ +-------+
| | |IRC Trading Pit| | |
| |+---(1) order offer--->| |+------>| |
| | +---------------+ | |
| | | |
| | +---------------+ | |
| |<---(2) order accept--+|IRC Private Msg|<------+| |
| | +---------------+ | |
| | | |
| A | +---------------+ | B |
| |+---(3) dlc offer----->| Bob Transport |+------>| |
| | | Server | | |
| |<---(4) dlc accept----+| |<------+| |
| | | | | |
| |+---(5) dlc sign------>| |+------>| |
| | | | | |
| |<---(6) dlc finalize--+| |<------+| (6) broadcast fund-tx
+-------+ +---------------+ +-------+
- where client A is 'offerer' and node B is 'accepter'