Title: What are the fees on the Lightning network? Post by: justone123 on January 25, 2018, 01:07:34 PM So i'm just wondering what are the fees like on the Lightning Network?
I've seen someone mention that fee for payment going through 3 hubs was 0.2$. This still seems rather expensive :x Will micropayments be even possible, or is this something that will be possible only if you are connected to the same hub. I mean, can someone give an insight, what are the fees going to look like on the LN? Will it be 0.001%,0.01%, 0.1%, 1%, 10%...? Title: Re: What are the fees on the Lightning network? Post by: TheQuin on January 25, 2018, 01:53:04 PM If you are talking about the live network rather than testnet then it has only just started to be populated by nodes.
https://p2sh.info/dashboard/db/lightning-network?orgId=1 So far only 539 channels exist. As more nodes and channels get added then they will compete with each other on fees and they will most likely end up being minimal (fractions of a cent). Title: Re: What are the fees on the Lightning network? Post by: achow101 on January 25, 2018, 03:59:42 PM Thus far the only fees that I have observed have been only one satoshi per hop. Granted that's on testnet.
Title: Re: What are the fees on the Lightning network? Post by: Anti-Cen on January 25, 2018, 05:07:12 PM So far only 539 channels exist. As more nodes and channels get added then they will compete with each other on fees and they will most likely end up being minimal (fractions of a cent). The argument about the free market did not stop BTC fees hitting the roof so who's going to ensure we don't get more of the same. I don't think LN has gone live and was expecting a wait of 9 months to a year so do you have a link please or are you talking about testnet Title: Re: What are the fees on the Lightning network? Post by: achow101 on January 25, 2018, 05:36:23 PM I don't think LN has gone live and was expecting a wait of 9 months to a year so do you have a There are already people using LN on mainnet. There does not need to be a release of LN (whatever that means) or for it to "go live". It's not a central thing where one group can announce that it has "gone live".link please or are you talking about testnet Some stats about the LN mainnet can be found here: http://lnstat.ideoflux.com:3000/dashboard/db/lightning-network?refresh=5m&orgId=1. A graph of the nodes can be found here: https://lnmainnet.gaben.win/ Multiple people are accepting LN mainnet payments such as TorGuard: https://twitter.com/TorGuard/status/950383059735646209 and Blockstream: https://store.blockstream.com/ Title: Re: What are the fees on the Lightning network? Post by: TheQuin on January 25, 2018, 05:38:32 PM The argument about the free market did not stop BTC fees hitting the roof so who's going to ensure we don't get more of the same. It's not really comparable as there is no limit on capacity in the way there is with blockchain. Add more nodes and channels and you get more capacity. I don't think LN has gone live and was expecting a wait of 9 months to a year so do you have a link please or are you talking about testnet The link I posted above is showing stats of channels and BTC on the live network. The software available comes with "Warning: Do not use on mainnet" written somewhere, but as ever pioneers will ignore health warnings and the live LN is growing as we speak. Title: Re: What are the fees on the Lightning network? Post by: ruletheworld on January 25, 2018, 10:22:24 PM There's no one fees on the Mainnet yet for Lightning.
Tokensoft announced 0 fees to connect with them. Here are the details: https://medium.com/tokensoft/tokensoft-lightning-node-how-to-connect-for-free-62b9aaec18b8 The total fees paid depends a lot on the number of hops. Less hops means less fees. This is not really in your control, but if you connect directly with the 'super-nodes' which are in-turn connected to many parties, you can reduce fees that way. The fees will depend a lot on the lightning network nodes' fee policies. In reality, there are already 3 different implementations of Lightning and they are all compatible with each other. This means no one company or software implementation will have a monopoly on this. Therefore the fees are expected to be quite small, since there is enough market competition out there. Title: Re: What are the fees on the Lightning network? Post by: Anti-Cen on January 25, 2018, 10:31:32 PM There are already people using LN on mainnet. There does not need to be a release of LN (whatever that means) or for it to "go live". It's not a central thing where one group can announce that it has "gone live". The main block chain nodes needs to cooperate with LN nodes for the protocol towork so unless they hardwired a few nodes to get it going then I am not sure how it would work on broadcasts to the BTC network unless that part was already released in Bitcoin core 0.15.1 Quote Some stats about the LN mainnet can be found here: http://lnstat.ideoflux.com:3000/dashboard/db/lightning-network?refresh=5m&orgId=1. A graph of the nodes can be found here: https://lnmainnet.gaben.win/ Interesting and about 650 channel when I looked and already we can see banker hubs that have forty channels or so and that means that someone must have lots of money to deposit in new channels for these large inter bank transfer's. Some of the hops are eight long already and I don't think this will go up or down much even if 50,000 channels are created and interest charged on the inter bank BTC should be low if the outbound and inbound amounts balance out but you can bet the transit fees will be past to Bob but if the channel is bidirectional then the first hub will be picking up the lion share of interest fees. Please correct me if I am wrong but in the ledger connecting Bob to the banking hub requires the bank to deposit $100 in it if Alice on the far side of the network is to send Bob $100 and if she wants to send him $200 then it would not be allowed because money cannot be moved from ledger to ledger because the BTC-Block chain only allows the existing money to be settled on block. Bob Banks $100 $0 Bobs deposit 0 $100 Banks deposit $200 $0 Alice sends Bob $100 Unless Bob starts spending then no one can now send him any money so spending is cheap but if you receive lots of payments then interest for inbound money could far exceed 5% p.a if you keep the channel open for 12 months or get the banks to deposit a smaller amount in the channel and then keep closing and opening a new channel but picking up the BTC Tx fee each month. Title: Re: What are the fees on the Lightning network? Post by: Anti-Cen on January 25, 2018, 10:47:36 PM In reality, there are already 3 different implementations of Lightning and they are all compatible with each other. This means no one company or software implementation will have a monopoly on this. Therefore the fees are expected to be quite small, since there is enough market competition out there. My understanding is that Bobs and Alice might have wallets but unless they have lots of buttons to press then they will not be in a position to use much of the LN protocol but the banker hubs will have custom software that gives them the advantage. Miners will run the banking hubs because they need bandwidth, hardware, lots of BTC and understand the nuts and bolts. Miners are already a monopoly as you can see https://blockchain.info/pools I can already change from one high street bank to another if fees become too high so was ten major LN hubs to put up the fees then this will have a ripple effect as the fees will move down to main branch, sub-branch and then on to Bob & Alice and I have already come across the term "Virtually free transactions fees" in the bitcoin white paper and won't be trusting them a second time Title: Re: What are the fees on the Lightning network? Post by: DannyHamilton on January 25, 2018, 11:33:35 PM The main block chain nodes needs to cooperate with LN nodes for the protocol to work You'll have to explain what you mean by cooperate. Lightning Network requires that the channel participants open a channel by broadcasting a transaction that gets confirmed in the blockchain. This is no different than any other bitcoin transaction, and requires no more cooperation from "main block chain nodes" than any other transaction would require. After that transaction gets confirmed and the channel is therefore opened, the transactions over the Lightning Network do not require any additional cooperation from "block chain nodes". so unless they hardwired a few nodes to get it going then I am not sure how it would work on broadcasts to the BTC network unless that part was already released in Bitcoin core 0.15.1 I assume you are talking about the implementation of SegWit? That's been available on the BTC network for a while now. Interesting and about 650 channel when I looked and already we can see banker hubs that have forty channels or so You say "banker hubs", I say "individuals that have opened lots of channels". They provide no banking services. They collect no fees. Any user can skip them and connect to any other user if they want to. and that means that someone must have lots of money to deposit in new channels Or it means that someone opened many channels with a very small amount of funds in each channel. for these large inter bank transfer's There are no banks, (at least not yet). Therefore, there are no "inter bank transfers". Please correct me if I am wrong but in the ledger connecting Bob to the banking hub requires the bank to deposit $100 in it if Alice on the far side of the network is to send Bob $100 and if she wants to send him $200 then it would not be allowed because money cannot be moved from ledger to ledger because the BTC-Block chain only allows the existing money to be settled on block. You really need to start using the common use Lightning Network words when you talk about the Lightning Network or you are going to cause a lot of confusion for yourself and others.
Bob Banks There are no banks (yet). There may never be banks. Regardless the process works the same, so lets substitute Charlie in for the user that you keep calling "Bank". It will make it clearer. Sicne you insist on using $ amounts instead of BTC amounts, we'll also assume that the exchange rate between $ and BTC doesn't change at all during that time. Bob opens a channel (Lets call it channel B-C) with Charlie. Bob funds the channel with $100 worth of bitcoins, and Charlie funds the channel with $100 worth of bitcoins. Alice opens a channel with Charlie (Lets call it channel A-C) with Charlie. Alice funds the channel with $200 worth of bitcoins, and Charlie funds the channel with $0 worth of bitcoins. Alice establishes a route through Charlie to Bob and sends $100 worth of bitcoins After that: The A-C channel state has $100 worth of bitcoins that Charlie can send through the channel to Alice and $100 worth of bitcoins that Alice can send to Charlie. The B-C channel state has $200 worth of bitcoins that Bob can send through the channel to Charlie and $0 worth of bitcoins that Charlie can send to Bob. Unless Bob starts spending then no one can now send him any money If that is the ENTIRE network, then you are correct that no one can send him any money through Lightning Network (although they could still send a non-Lightning Bitcoin transaction if they want to. However, it is possible that Bob could already have (or could open) other channels with other users, or Bob could open a new channel with Charlie. My understanding is that Bobs and Alice might have wallets but unless they have lots of buttons to press then they will not be in a position to use much of the LN protocol Why do they need buttons? Can't they just use wallets that can establish a lightning channel? but the banker hubs will have custom software that gives them the advantage. Why won't Bob and Alice have access to similar software? Miners will run the banking hubs because they need bandwidth, hardware, lots of BTC and understand the nuts and bolts. When you say "miners" I assume you mean "Mining pool operators"? Because most of the hashers that I've talked to most certainly do NOT "understand the nuts and bolts". Furthermore, exchanges could choose to set up enough channels to be considered a "hub". Payment processors could choose to set up enough channels to be considered a "hub". Businesses that handle BTC payroll could choose to set up enough channels to be considered a "hub". Anyone that currently runs a "full node" probably already has the necessary "bandwidth, hardware, and understanding of the nuts and bolts" to choose to set up enough channels to be considered a "hub". It doesn't require much bitcoins to open a channel. Miners are already a monopoly as you can see https://blockchain.info/pools I don't think the word "Monopoly" means what you seem to think it means. That being said, I will agree that it would be nice if there weren't any mining pools with access to more than 5% of the global hash power. The current distribution isn't my preferred balance, but it works. I can already change from one high street bank to another if fees become too high so was ten major LN hubs to put up the fees then this will have a ripple effect as the fees will move down to main branch, sub-branch and then on to Bob & Alice I'm having a difficult time following what you are trying to say there. I have an account with my local Credit Union. I have an pleasantly low interest rate on my mortgage and car loan, and I don't pay any other fees for any of the services that I use. There are services that have fees, but I don't use any of those services. I have already come across the term "Virtually free transactions fees" in the bitcoin white paper I've seen you use this "Virtually free transactions fees" statement multiple times now. I've checked the whitepaper and I don't see that statement in there at all. Can you please tell me where to find it, or did you just make that up so you can sound angry about something that doesn't exist? and won't be trusting them a second time Who is this "them" that you speak of? The bitcoin white paper was written by Satoshi Nakamoto. He was not involved in the creation of Lightning Network at all. Title: Re: What are the fees on the Lightning network? Post by: ruletheworld on January 26, 2018, 12:27:57 AM There are no banks (yet). There may never be banks. Regardless the process works the same, so lets substitute Charlie in for the user that you keep calling "Bank". It will make it clearer. Sicne you insist on using $ amounts instead of BTC amounts, we'll also assume that the exchange rate between $ and BTC doesn't change at all during that time. Bob opens a channel (Lets call it channel B-C) with Charlie. Bob funds the channel with $100 worth of bitcoins, and Charlie funds the channel with $100 worth of bitcoins. Alice opens a channel with Charlie (Lets call it channel A-C) with Charlie. Alice funds the channel with $200 worth of bitcoins, and Charlie funds the channel with $0 worth of bitcoins. Alice establishes a route through Charlie to Bob and sends $100 worth of bitcoins After that: The A-C channel state has $100 worth of bitcoins that Charlie can send through the channel to Alice and $0 worth of bitcoins that Alice can send to Charlie. The B-C channel state has $200 worth of bitcoins that Bob can send through the channel to Charlie and $0 worth of bitcoins that Charlie can send to Bob. Great explanation btw, but the math seems off. In your example, won't the A-C channel have $100 worth of Bitcoins that Alice can still send to Charlie, since Alice started with $200 worth of Bitcoins? Title: Re: What are the fees on the Lightning network? Post by: DannyHamilton on January 26, 2018, 03:01:53 AM the math seems off. In your example, won't the A-C channel have $100 worth of Bitcoins that Alice can still send to Charlie, since Alice started with $200 worth of Bitcoins? Good catch. Thanks. Fixed it in my post. Title: Re: What are the fees on the Lightning network? Post by: cluit on January 27, 2018, 08:55:49 AM So i'm just wondering what are the fees like on the Lightning Network? I’m not an engineer or Dev, or whatever, just came across this post and it seemed quite interesting. Why is someone asking about the fees for lightening network, has it been released already? Cos I’m not seeing any lightening network or something. Last time I made a transaction, I was charged $16 and the transaction took about 15 minutes or so… or was it released in just few locations.I've seen someone mention that fee for payment going through 3 hubs was 0.2$. This still seems rather expensive :x Will micropayments be even possible, or is this something that will be possible only if you are connected to the same hub. I mean, can someone give an insight, what are the fees going to look like on the LN? Will it be 0.001%,0.01%, 0.1%, 1%, 10%...? Title: Re: What are the fees on the Lightning network? Post by: Samarkand on January 27, 2018, 09:19:07 AM ... I’m not an engineer or Dev, or whatever, just came across this post and it seemed quite interesting. Why is someone asking about the fees for lightening network, has it been released already? Cos I’m not seeing any lightening network or something. Last time I made a transaction, I was charged $16 and the transaction took about 15 minutes or so… or was it released in just few locations. The Lightning Network won´t have a fixed release date, because there is not a single Lightning software that you could use as a reference. Instead there are multiple teams working on multiple implementations of the underlying protocol. As of now I´m aware of the following projects: -lnd GitHub (https://github.com/lightningnetwork/lnd) Project website (http://lightning.network/) -eclair GitHub (https://github.com/ACINQ/eclair) Project website (https://acinq.co/) -c-lightning GitHub (https://github.com/ElementsProject/lightning) Project website (https://blockstream.com/technology/) Besides, some people are already using the Lightning Network on mainnet. You can track the current usage using a website like this (already posted by TheQuin in the 2nd post of this thread): https://p2sh.info/dashboard/db/lightning-network?orgId=1 Of course there is still the possibility of undiscovered bugs therefore it isn´t widely deployed, but as you can see the adoption is increasing steadily. Title: Re: What are the fees on the Lightning network? Post by: Kprawn on January 27, 2018, 02:23:40 PM In a perfect implementation the users can chose the least expensive route, right? The Lightning Network wallet provider will
give the user a nice GUI interface to chose the fee options, like it is done now? How will the user know if that route is the least expensive route? Many wallet providers are currently manually inflating the actual "minimum" fees that are being recommended. Most users will not care about this, if the fees are low.... but wallet providers could prioritize different routes, before the interface reports the "cheapest" route to the user. <favouring the channels that they hosted> Do you agree? Title: Re: What are the fees on the Lightning network? Post by: Anti-Cen on January 27, 2018, 08:37:42 PM before the interface reports the "cheapest" route to the user. <favouring the channels that they hosted> Do you agree? it almost feels like me and you are starting to get along better together if you keep talking like that :D I think your saying that people will hold say three channel open with banker hubs and the wallet will workout who's going to be the cheapest which might not always be the shortest ? looking at this I think that the average hop count will be 6-8 hops https://lnmainnet.gaben.win/ but they are not fixed because for instance some ledgers will need liquidity moving from right to left and will actually offer negative transaction fees (Pay you to use them) which you can read about in the white pages so I think it will be very much a finger in the air type number myself when it comes to fees and interest on the banks money Maybe we need official base rates and then banking hubs can offer X over base and a fixed fee per transaction but if the wallets interface becomes over complicated then Jaxx , Exodus and others will not write the code to make all this work so then shapeshift becomes trouble which would all be bad news for our slot-machine friends Shit banking hubs will become ranked by users, like it or not based on the IP address or wallet address so maybe they should build that into the system so that when you are shopping for a bank you can read the terms and conditions so we all know where we stand. Title: Re: What are the fees on the Lightning network? Post by: Anti-Cen on January 27, 2018, 11:13:30 PM There are no banks, (at least not yet). Therefore, there are no "inter bank transfers". Well if you want to pretend that someone with 50 channels open acting as a major hub is not acting as a bank then that's up to you but this picture says that you could be wrong. https://lnmainnet.gaben.win/ Quote
Yes the channel is the ledger with deposits in it from both the user (who could also become a banking hub, inter bank transfer) and the banking hub in LN Quote
Yes see the link, Bob only like one channel open, these things cost you know Quote
Yes one channel and not connected to a "person" who has 50 channels, it's a banking hub and needs a ton of money to feed all them other channel deposits. Miners have the money and hardware so they are the natural bankers running the banking hubs. Quote
Yes and she is connected also with one channel to a banking hub. Quote
Correct
Channel is the ledger with both ends keeping a copy but the key point shown in bold above. Money is not liquid in LN and is more like snooker balls bumping into one another and money stays in the ledger. See white paper https://lightning.network/lightning-network-paper.pdf Quote There are no banks (yet). There may never be banks. Yes sure mate so what do you call something that charges fees on both lending and transactions fees and loves people so much that they open 50 channels. Sorry you can keep repeating yourself but the links I gave you prove otherwise. Quote Regardless the process works the same, so lets substitute Charlie in for the user that you keep calling "Bank". It will make it clearer. Sicne you insist on using $ amounts instead of BTC amounts, we'll also assume that the exchange rate between $ and BTC doesn't change at all during that time. Well if it looks, talks and walks like a bank then lets call "Charlie" Natwest bank in central Cambridge and I am sorry about not using 0.00001000 BTC but I think we can live with it for now. Bob opens a channel (Lets call it channel B-C) with Charlie. No lets call it "Natwest bank in central Cambridge" Quote Bob funds the channel with $100 worth of bitcoins, and Charlie funds the channel with $100 worth of bitcoins. OK Quote Alice opens a channel with Charlie (Lets call it channel A-C) with Charlie. Alice funds the channel with $200 worth of bitcoins, and Charlie funds the channel with $0 worth of bitcoins. Alice establishes a route through Charlie to Bob and sends $100 worth of bitcoins After that: The A-C channel state has $100 worth of bitcoins that Charlie can send through the channel to Alice and $100 worth of bitcoins that Alice can send to Charlie. The B-C channel state has $200 worth of bitcoins that Bob can send through the channel to Charlie and $0 worth of bitcoins that Charlie can send to Bob. Yes if Natwest bank only deposits $100 then the channel is too small for Bob to receive $200 from Alice Quote If that is the ENTIRE network, then you are correct that no one can send him any money through Lightning Network (although they could still send a non-Lightning Bitcoin transaction if they want to. However, it is possible that Bob could already have (or could open) other channels with other users, or Bob could open a new channel with Charlie. Yes but why should Bob keep paying the BTC miners money ? Quote Why do they need buttons? Can't they just use wallets that can establish a lightning channel? Never seen a software wallet yet that does not have buttons have you but in the case of Lightning you will need more than the usual few buttons to act as a banking hub so the banks will have specialist software. Quote Why won't Bob and Alice have access to similar software? Well Jaxx and Exodus won't implement all that in the wallets and Bob would not understand things like HTLC or how to maximize profits by acting as a bank even if he could share his wallet to become a hub so his friend Alice could use it. Quote When you say "miners" I assume you mean "Mining pool operators"? Because most of the hashers that I've talked to most certainly do NOT "understand the nuts and bolts". Just swap the name "Miner" for "Sub-Branch" and see "Mining pool operators" as "Nat west head office" and you about get the picture. Quote I don't think the word "Monopoly" means what you seem to think it means. Cartel is just as good to meQuote I'm having a difficult time following what you are trying to say there. I have an account with my local Credit Union. I have an pleasantly low interest rate on my mortgage and car loan, and I don't pay any other fees for any of the services that I use. There are services that have fees, but I don't use any of those services. Nice for you but I also bank with Ripple, all transactions are on-block and more or less free just like Bitcoin was before it was taken over. Quote I've seen you use this "Virtually free transactions fees" statement multiple times now. Then don't fall for it again. Quote I've checked the whitepaper and I don't see that statement in there at all. Can you please tell me where to find it, or did you just make that up so you can sound angry about something that doesn't exist? Not in the LN white paper but original Bitcoin white-paper Quote Who is this "them" that you speak of? The bitcoin white paper was written by Satoshi Nakamoto. He was not involved in the creation of Lightning Network at all. Them is the development team who roll over backs to please the miners and in many cases run mining themselves and it is the same "Them" that own BTC from day one and it only cost "them" $0.15 per coin but we can agree that Satoshi Nakamoto was not involved in LN Title: Re: What are the fees on the Lightning network? Post by: Anti-Cen on January 27, 2018, 11:30:27 PM As far as i know, you only can charged fees when use LN on these conditions : 1. Open new LN channel. 2. Close LN channel. 3. Refill your balance. 4. Using hops which charge small fees when you don't have direct connection to receiver, but you don't have to use hops which charge fees. If on-chain fees can be reduced and you don't use hops which charge fees, fees when using LN should be extremely reduced. CMIIW. See https://lnmainnet.gaben.win/ I make it about six to eiht hops so that's five times "charge small fees" plus the first hub in bi-directional channel need to deposit the banks money in the channel so that's going to amount to interest even if you don't use the channel it's still on loan to you for incoming payments. You cannot reach across the world to send money without using banking hubs in one off payments but you could open one with you mum on the other side of the world, keep it open and keep sending each other money a millions times and call it almost free but in the real world that's not how things works. Open the LN white paper and search for the word "Fee" to see it's written all over the document and whats more none of the fees are capped so in the end you are at the mercy of the bankers and we are talking about the same people that currently run mining and charge you $20 just to store 250 bytes of data and take all day just to do that. |