Comment by sph
12 hours ago
https://en.wikipedia.org/wiki/Lightning_Network
I have been paying for my VPN with lightning payments; it takes less than one second to go through.
12 hours ago
https://en.wikipedia.org/wiki/Lightning_Network
I have been paying for my VPN with lightning payments; it takes less than one second to go through.
The Lightning Network is specifically designed to work around bitcoin design flaws. It entirely sidesteps the chain for a big part of the process. To me it proves that Satoshi did not, in fact, think of everything. Not the other way around.
> it takes less than one second to go through Like Bitcoin used to be before someone had the brilliant idea of destroy the possibility of zero-confirmation transactions on-chain with Replace-by-fee transactions
How does this work? I read the wikipedia article but I don't understand how Lightning enforces the transaction.
The peers generate two sets of transactions.
One is a quick summary of the current balance in a channel. A new transaction is created each time the balance in the channel changes. It's somewhat cheap to put on the blockchain (And the main saving is that you only need to post the final update when you close the channel), but venerable to one side putting an old stale transaction onto the blockchain to profit.
The other transaction forms a chain of proof for current state, invalidating previous balance update transactions. It's somewhat expensive to post, as it will pull in the whole history.
Both peers need to continually watch the chain (or contract a 3rd party to watch) to make sure the other peer isn't cheating by posted a stale balance transaction. These special transactions are time locked, so once one is posted, you have like 24 hours to post the proof transaction and reverse it.
This link explains it a bit better: https://lightning.network/ and see the paper at the end for the exact details
Lightning has mostly done this by being a lot more centralized in practice and one could argue... What's the point of it all in this case? Why not just use regular currency?
Sorry, I do not understand your comment. Can you clarify. What does "a lot more centralized in practice" mean?
> What's the point of it all in this case?
Lightning is an L2 protocol, highly scalable and used for low cost payment in Bitcoin. Level 1 networks are almost never used for user transactions: your credit card payments do not go over fedwire, etc. Bitcoin protocol is not scalable to serve worldwide money transfer needs; Lightning is. And with the cost of a penny per transaction or so.
> Why not just use regular currency?
There are a lot of frictions in the current banking systems, because money laundering, because drugs, because whatever. Getting $5-$10k in regular currency while on an overseas trip can be a major quest. With Lightning I can transfer that much (or more) in a few mouse clicks.
As a side note, I think the federales are already way too nosy regarding my use of my own money, so I want to give alternative options as much business as I can. My 2c.
Isn't it hard to use in practice? Liveness, inbound liquidity, moving funds between L1 and L2, don't all of those lead to massive use of hubs, this denying the entire premise of decentralization?
2 replies →
Could you elaborate why it is more centralized?
The point is that it is resistant to censorship, it is pseudonymous, and so on (all the other bitcoin attributes apply)