Golem (ILP)

A Golem in the context of Interledger Protocol (ILP) refers to a type of Interledger Agent that functions as a settlement engine within the Interledger network. Golems are responsible for moving value across disparate ledgers connected via ILP, acting as intermediaries that facilitate transactions between parties using different underlying ledger technologies.

Specifically, a Golem leverages ILP connectors to establish payment channels or utilize atomic swaps to transfer funds. It monitors ILP packets, enforces conditional payment agreements (HTLCs - Hashed Time Locked Contracts) that ensure atomic transactions, and manages account balances associated with various ILP connectors.

Unlike a simple ILP connector that only routes packets, a Golem actively participates in the settlement process. It typically maintains its own internal ledger and engages in clearing and settlement procedures with other Golems and connectors within the ILP ecosystem. The term "Golem" often implies a higher degree of autonomy and financial responsibility compared to standard ILP connectors.

The functionality of a Golem is critical for realizing the vision of Interledger, which aims to connect all ledgers and enable seamless global payments. By acting as a reliable and secure settlement engine, Golems ensure that transactions are executed accurately and efficiently across diverse ledger systems. The security and reliability of a Golem are paramount to the overall health and trust within the Interledger network.