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Good writeup!

There are two questions where I would want to know a little bit more:

Here I would like a clarification what is exactly not possible. Can't the payer initiate a Lightning transaction, waiting a time (e.g. 24 hours) until the other node pops up to sign its part? It's clear that both have to be online at the same time somewhen, at least for a moment. And: Does the "watching" node need to be connected with the destination node?


Here an interesting addition is if there is a "standard" timeout/lock time for the Lightning "penalty transaction" - to know how often you should be online to avoid being cheated. I've currently no Lightning node running (I tested Eclair some weeks ago but it's now outdated, so I can't answer that question myself.) Normally, you should be able to set the timeout you want, but what are the chances you will find a route or a partner to open a channel with?

Very interesting and helpful topic, I would merit if I still had it.
From a user point of view sounds like LN it's a potential breaktrough innovation but still with some big issue to fix
(opening a channel 24/7 is clearly impossible, and it's not clear to me how you can manage negative balance once a user wants to close his channel).

Anyway there's a sentence that sounds really disappointing to me


It's one year since BCH fork, and after all that debate here's the conclusion  :o.
I quite disagree with it. Block weight should stay 1 MB forever. Makes no sense to me increasing it.

One of the problems is that even if the other party would come back online for a few seconds after 24 hours, the route might have changed so the transaction would not take place. The word "watching" was probably the worst one that I could have used. I was thinking of a service which would accept payments on behalf of someone (connection to both nodes would have to exist) and then send it to the destination node on demand.


I'm quite sure that locktime is being negotiated while you are trying to open a channel therefore it will vary for your each connection with the other node. Finding someone with the same channel policy might be a bit difficult.


I didn't write that we have to increase the block weight 30 times. There are plenty of things that can be done in the future before increasing the block weight, for example, implementing channel factories (https://bitcoin.stackexchange.com/questions/67158/what-are-channel-factories-and-how-do-they-work#67187) which allow users to create new Lightning Network channels from existing ones - no need to broadcast closing and opening transaction. I have changed the sentence you quoted in order to make it more neutral  ;)

Lightning Network Risk Prevention Measures

FMyGdTk6iXFqfnSbvBtte

The Lightning Payment Layer 1 private key (cold storage) is generated offline, and the second layer private key is generated by using the wallet address as the brain wallet seed, and is cyclically calculated to the 100th layer. Use the last layer 100 public key as the public key for lightning payment. If the lightning private key is stolen, the layer 99 public key is broadcast in time to invalidate the 100th layer public key. It can prevent stolen 100 times.

Lightning channel establishment:
1. Sign the authorized private key with cold storage to authorize the lightning payment of the layer 100 public key, and all lightning payments do not use the original private key. Both the original private key and the lightning layer 1 private key are cold storage (offline) and are very secure.
2, in order to control the risk, you must set the daily payment limit of each party (such as: daily maximum limit: 60 yuan for one party, 70 yuan for B party). If the lightning private key of Party B is stolen, Party B will use cold storage for original private use. The key closes the channel on the chain, and at most, it will only lose the maximum payment of 70 yuan for the day.

In order to save the blockchain space, when the lightning channel is established, the blockchain only stores the hash value of the lightning-paid third-layer public key and the daily payment limit. The party applying to close the channel must provide the original information for the miner to verify the Lightning Payment Level 100 public key for both parties and the maximum daily payment limit.

Welcome to support BTC address: 18cZYPCppT5LbUjwDoqdjVGUP8jFoCPGcE

Suggested edit:

That makes sense, thanks for the clarification.

However, a workaround shouldn't be difficult: the client of the "customer" could simply save the "intention" of the transaction, and it would get carried out if the second node pops up before a timeout is reached. In this case, the route is decided only at the moment both nodes are online.

Yep, that sounds more logical. Unfortunately, that would provide incentives for hubs.

OK, I'll probably soon test an updated Eclair again and look how it's implemented there.

And regarding your response to Vigme86: I agree with a conservative block size policy, and I have some hopes that the sidechain concept isn't fully forgotten because it could serve as an excellent intermediate layer. We could then have the following structure:

Mainchain -> Sidechains/Pegged chains -> Channel factories/Superchannels -> "reloadable channels"

I have just added a few new questions and I am still looking for more. Don't be afraid to ask! The new ones are: Which wallet is the best one?, Do I have to run a full Bitcoin node?, How do I set up a Lightning Network node?, What happens if some nodes go temporarily offline?


Thanks for catching that! Fixed.

As I mentioned in my other thread, this problem has been addressed in the v0.5 release of LND (https://github.com/lightningnetwork/lnd/releases/tag/v0.5-beta). I have just edited the topic and included proper explanation. I have also included a few questions which were answered by me in this (https://bitcointalk.org/index.php?topic=5052981.msg47027162#msg47027162) thread.

In this article some big concerns are being raised


what do you think

https://cryptobriefing.com/whats-holding-back-the-lightning-network/

There is nothing wrong with the article. Being online all the time is mandatory for receiving payments. There are still many channels which have low capacity. I am not surprised that payments higher than $200 fail. There are two reasons for that. The Lightning Network is still in an early state and people don't want to lose money. It was designed to handle mostly micro-transactions due to low transactions cost and their instant.


Just give it a few more months. Lightning Network Specification 1.1 is currently being written. I will write about it today in another thread.

I have just updated this thread with answers to the following questions. Do I have to generate an invoice every time I want someone to send me coins over the Lightning Network? Can I refill my channel? Why can't I receive coins? Don't hesitate to ask questions either in this thread or in the Lightning Network discussion (https://bitcointalk.org/index.php?topic=4638321.300) one.

OP, Brand7 also made a Lightning FAQ on Medium, https://medium.com/@The1Brand7/lightning-faq-67bd2b957d70

There might be some questions answered there that are not in your post that newbies need to read before they succumb to the FUD, and misinformation from people who either are gaslighting or don't understand how it works.

i guess this is where windfury gets his mis-information.
so lets atleast state the obvious. seeing as he thinks the link he quotes is his bible to LN. lets use it against him with some obvious falacies

Q 7: Will there be any form of custodian risk in a Lightning Network?
Do I need to trust anyone to hold my money on my behalf?
A: No, this system is not based on trust; you remain in full control of your money.
vs
Q13:
A Holding value on a Lightning Network means that you are in possession of double-signed transactions. .....
The transactions you are holding are of the 2 of 2 multi-signature type.
Both you and your counterparty will sign, and you will both store the transactions locally.

---

Q 8: I’ve heard that Lightning transactions are happening “off-chain”…Does that mean that my bitcoin will be removed from the blockchain?
A: No, your bitcoin will never leave the blockchain.
vs
Q 9: I’ve heard that the Lightning Network will require my bitcoins to be locked up…Is this correct?
A: “Locked up” is a very misleading term in this case.
Lightning will not make your money less accessible.
Your money will actually become more accessible when held in a Lightning channel.

---

and then there is the big facepalm of Q14

the long waffle that bitcoin has no coin and is just signed message so if signed messages are involved then it must be bitcoin

what the article DOES NOT correctly mention is that the payments within LN are measured in MILLISATS as the unit of account. but the bitcoin network is measured in sats.

a LN payment signed in millisats would not be accepted onto the bitcoin network.
this is why people on LN lose value/get locked out when errors arise as the LN system does not use 8 decimal(sat) transactions at all times. it only uses them for the opening/closing
when people go offline, or you lose your data or someone on a route does not agree to the route in time. 'value' in LN gets locked because its not just using standard bitcoin transactions of 8 decimal where all thats needed is the privkey to move value.


windfury. please do yourself the biggest favour, and update your research

::)

Why should I be the only one who needs to update "my research", when everyone with a sane mind knows that there are no "IOU pegged promises to pay tokens" in Lightning?

You're not convincing anyone, except maybe some newbies, and which I encourage them to believe you to make them actually learn from experience. 8)

you repeat the same thing, but have no clue. get a clue and see if your repeats matches your own clue.
i gave you a clue, its called millisat. now its time you go out and search about it and learn it then go learn beyond it taking more steps until you find your own clue

You also repeat the same thing, and accuse me of not learning anything, when everything I have learned is nothing but the truth, and no sane Bitcoiner can accept your opinions because "IOU pegged promises to pay in Lightning" is simply, wrong.

You can trick the newbies though, which I encourage, to make them have actual learning experience with the "different" people in the community. But they will also know the truth sooner, or later. Sorry.

I guess every single person on planet Earth is going to have to update their definition of the word "fallacies", as apparently franky1 has decided it means something new now.  Or maybe that's why franky1 also decided to come up with a brand new spelling for it.   ::)

There are no fallacies in the above text unless you don't understand LN.  

There are no custodians in Lightning.  A custodian is a third party who holds and controls your funds directly.  If you make a payment via a bank transfer or card payment, a bank is generally the custodian you are required to place trust in.  With LN, the transaction is between you and the other person, peer to peer.  If your payment is routed through other users, those users are not in direct control of your funds.

Bitcoins in a hashed time lock contact, or HTLC, do not leave the Bitcoin blockchain.  Fractional reserve is not possible and there are no "IOUs".  Whatever total amount is placed in the initial HTLC CLTV, it will be the same total that is broadcast back to the blockchain when the channel is closed.  

bitcoin locks on the blockchain are not HTLC's, the blockchain tx's are timelocked multisigs using CLTV
bitcoins on the blockchain use a different type of lock

i can see where you can get easily confused with simple 4 letter acronyms  CLTV vs HTLC

the HTLC's in LN are the temporary 'payment/invoice' IOU contracts
what you might want to do is read some code.

but first. a challenge for you
go to bitcoins github. and in the search type in msat
go to LNs github. and in the search type in msat

what you will notice is bitcoin does NOT have a single reference to millisats or msats
https://github.com/bitcoin/bitcoin/search?q=millisat&unscoped_q=msat
" We couldn’t find any code matching 'msat' in bitcoin/bitcoin
You could search all of GitHub or try an advanced search. "

https://github.com/lightningnetwork/lnd/search?q=msat&unscoped_q=msat
" 70 code results in lightningnetwork/lnd or view all results on GitHub"

what you then do if you start reading more code is learn a HTLC is not a "final state" transaction

hopefully what you realise is that the VALUE that changes as temporary IOU (it changes as different agreements of who OWES what changes) is measured in LN as millisats. which is a different unit of account than bitcoins/satoshi's. infact a unit of account bitcoin dos not recognise

have a nice day with your research

I stand corrected.  CLTVs are indeed the lock used on Bitcoin's blockchain.  However, this doesn't negate the point about there being no fractional reserve or IOUs.



There is still an appreciable difference between an "IOU" and a transaction that has been signed and approved by both parties.  It is far easier to renege on an IOU than it is to renege on a payment channel where both parties have revoked the previous commitment state.  You can certainly keep calling it an IOU if you want, but I suspect I'm not the only one who will never accept such a crass definition.

HTLC's can be reneged on
HTLC's are not even bitcoin transactions (msats units) a HTLC will not broadcast to a blockchain
renegociating how much they OWE each other without actually settling up, is the very definition of an IOU

as for fractional reserves. because LN is off chain. because its not community audited and the contracts are private between 2 people. they CAN both agree privately to say they have more then they really do.
EG instead of having $10 of real balance in a channel. they can say they have $160 in a channel thus letting others outside the partnership form route through them for $160 and thus the other outside part hand over $160
a[$160:$000]b[$010:$000]c   here A wants to pay C $160. but it wouldnt happen because B has only $10 hand to C
a[$160:$000]b[$160:$000]c   B:C can privately agree to say B has $160 to give to C just to get A to hand B $160

yes its possible because A does not get all the private details of b:c channel
you probably are wondering why would C agree to a lie about $160 in B:C if all C can get in 'real value' is $10
well there are many reasons. hacks, blackmail, extortion, friendship, malicious intent,, future owings, previous owings

LN has no auditors its just private agreements between counterparts and yes this can be abused
pleas take some time using LN, not with a fluffy unicorn utopia hat. but a critical thinking bug spotting hat/mindset. then when you spot the bugs and flaws that can be abused. you will see not only why LN is not that great. but you will start to appreciate why bitcoin(the real bitcoin with a blockchain) IS so great.
hopefully then you will start to recognise the double spend solution the byzantine generals solution and the other features of bitcoin which before 2009 were unsolved and had cypherpunks scratching their heads for years prior trying to solve.

at this moment LN nodes are already handing out channels with funds even before the supposed pegged bitcoin blockchain transaction gets a confirm.
at this moment LN nodes are already handing out channels with funds even without a bitcoin blockchain transaction. because the entities funded each other in other methods(coinbase balance, fiat, gold, altcoin)
(research-> bitrefill: thor turbo channel)

this is where things like factories start becoming part of the conversation too. but i think you need to start on the basic research before progressing to the more detailed stuff.

Shower thought question. There were a group of Bitcoiners who wanted a use case for zero-conf in Bitcoin. I read some comments that Roger Ver, and some big blockers, also wanted zero-conf for Bitcoin Cash.

Can Lightning be considered something like a suspended zero-conf?

shower thought.
seems your echo chamber seems today to be trying to draw you into the bitcoincash drama.
maybe concentrate on the core dev/ln dev drama instead. (yea i recognise your meander attempts)

lightning is not a suspended zero-conf for many reasons.

1. the lock of bitcoins(cltv) in satoshis on the blockchain can outpass the timelimit of mempool drop offs.
2. the lock of bitcoins(cltv) in satoshis vs the temporary lock(htlc) of lightning pegged millisats are not the same tx
(ln payments are not bitcoin tx's)

3. core added silly things like CPFP and RBF and more that reallocate which zero confirm bitcoin tx is of importance to a mempool
4. due to the direct IP connection of LN node counterparts its actually VERY EASY to relay tx1 to counterpart to hold in their mempool while doing a pushtx to mining pools a tx2.. and while ln node counterpart sees tx1 waiting.. a mining pools is collating tx2 into a block thus only tx2 ends up in a block

What drama? There's no drama, it's true. Or maybe you just want to avoid the truth that zero-conf is dead, and that Lightning is better.

It was only a question.


Forgive my stupidity. But are Lightning transactions more secure than zero-conf?

In ideal circumstances, LN is more secure than zero-conf.  But if we dare to think in terms of ideal circumstances, we'll incur franky1's wrath and he'll start accusing us of being of a "utopian mindset" again [//EDIT:  Did I call it, or did I call it? (https://bitcointalk.org/index.php?topic=4792622.msg51086098#msg51086098)  Predictable as ever  ::) ].  So we have to add the disclaimers about it being less secure if you can't stay online to monitor it, or the network is experiencing a heavy flow of traffic which could cause a timelock to expire, etc.

nope
firstly. LN's HTLC's can be renegged on.
secondly they can themselves become locked from utility due to OTHERS multiple route hops away.
thirdly they are not even in a 'balance' the originated coin of the peg would recognise.
fourthly in bitcoin a transaction is source to destination complete in one tx. (gets confirmed or not. pass or fail)
with LN it requires multiple htlc's where party of each HTLC all need to be online and communicating just for success(too many if's)

What peg? Let's avoid this old debate. Or please continue it on one of the other topics.

Moving on, would you agree to the idea that it might be better to develop an off-chain layer on top of Bitcoin using a hub and spoke model, before turning it into a more peer to peer model?

HTLC in LN are balance measured in msats
the CLTV locked bitcoin on the bitcoin network is measured in sats

bitcoin is locked and never moves from the bitcoin network
tokens on the LN network move and are in a different format

im now becoming shocked how many times i have to inform you of this and its like you just move onto a different topic, ignore its ever been told to you and you start again pretending 0 knowledge.
so instead of ignoring it. actually research it and move a step forward into actual knowledge

i dare you to search the bitcoin github for msat
i dare you to search the LN github for msat
you will see something on one that doesnt exist on the other

then
read the code of both githubs and you will see
a bitcoin 'coin' is 100,000,000 sat
a 'bitcoin' on LN is 100,000,000,000msat

here is some further lessons for you
https://github.com/lightningnetwork/lnd/blob/b0288d46773ac6d45e5dc4d5e6a80dd3034d0b9f/lnwire/msat.go#L13

LN is not a 'offchain layer ontop of bitcoin'
firstly LN is its own network (N of LN =network)
secondly LN was buzzworded and concepted even before bitcoin became compatible with LN
thirdly LN is not limited to bitcoin

the whole calling it a layer and saying its ontop of is just word play to try making it sound like LN is a bitcoin feature purely to gather fame and attention for sponsorship
LN is its own cryptocurerncy network of pegged tokens of multiple coins.
the sponsorship word play is much the same as circle word played themselves as a bitcoin company for sponsorship before then moving away from bitcoin..

Ok. I believe you, and all newbies, I encourage you to believe franky1 too. 8)

Moving on.


I know that it's not a perfect term because Lightning channels are really Bitcoins sent in a special 2-for-2 multisig address, that are sent back and forth peer to peer between its participants, and with all transaction records stored locally. But how would you call it?

Plus what's your opinion of an off-chain layer that utilizes a hub and spoke model?

its not about believing me.
i did not write LN code or comments with the LN code., emphasis i did not write LN
LN devs themselves wrote that. its actually pretty clear if you ever decide to read code and explanations by LN devs
thus no need to try making out its something related to me..
just read some code and use LN(do your own research). you will learn alot



bitcoins are locked on the bitcoin network in CLTV contracts. they never leave the bitcoin network
the bitcoin network always shows the UTXO on the blockchain as having X balance(sats)

LN views this and creates pegged tokens in HTLC. these HTLC's are contracts that are in a different unit of account(msats)
the HTLC's are not broadcastable to bitcoins network. thats its pegged coin

LN payments are the HTLC's, renegotiating who owes what but are not settling up. thus its IOU

windfury, if you want to get involved in LN discussions atleast drop the social name pointing and either do 2 things
1. use LN to understand it
2. read LN code to understand it

and try not to have amnesia evry morning to forget what was said so you can play dumb and just repeat your same false narative. atleast take steps to learn about LN and retain the knowledge.. it will help you

Newbies, franky1 has read the code, and therefore he's right. Listen to him. Thank you franky1, you have done the community an irreplaceable service.

Plus franky1 also encourages newbies to Do Your Own Research. 8)

Moving on.


But there are no "IOU pegged promises to pay tokens" in the Lightning Network either, it doesn't matter how much you post techno-babble. It simply isn't the truth.

Moving on.

What's your opinion of an off-chain layer that utilizes a hub and spoke model?

How our community plans to adapt LN to mass use with bad usability? It is very inconvenient when an ordinary user needs to open the channel to the node. It is also not understand for the continued support of the node, if the LN network commissions tend to 0.

wallets can be set up to manage channels without user doing anything



no, it tends to almost zero. this is because the costs of running an LN node are almost zero. But it's not zero, it's a tiny bit more than zero.

you seem to be complaining that it's cheap to use and that LN nodes being in a competitive market is what makes it so cheap to use? ??? sounds like a good thing to me

pegged tokens = Msats
bitcoin network does not recognise Msats..

IOU's are agreements that are not and will not settle. they are just temporary agreemnts of who OWES what
HTLC are agreements inside LN. HTLC's do NOT get broadcast to the main net blockchain networks
HTLC's are the IOU and the denomination balance of the HTLC is the pegged token

its not about beleiving me its about reading code and talking to devs and doing own research
as THEY(the devs) SAY
"Within the network, all HTLC payments are denominated in
// milli-satoshis. As milli-satoshis aren't deliverable on the native
// blockchain"

atleast do some rsearch and stop with the incessant and ignorant 'must be wrong coz franky" try to learn what actually happens on a network and not just concentrate on the person telling you. hense why i keep saying people should do their own research

after all whr is your code/research/stats/data that actually shows the opposite as a fair counter.. you dont provide it. you just repeat 'wrong coz franky' as you supposed proof (facepalm)

Face palm, stupid me. Newbies, listen to franky1, and Do Your Own Research. Moving on. 8)

What's your opinion of an off-chain layer that utilizes a hub and spoke model?


It's possible that Lightning transaction fees won't continue to be cheap as it develops, and matures. It might be lower than Bitcoin on-chain fees, but it will be higher than altcoin on-chain fees.

Because to provide liquidity in LN, a user must stake some Bitcoins, a valuable asset. Why would he/she not try to get something in return? The user also needs to manage his/her channels to maintain liquidity in both sides.

actually untrue
research thor turbo.  hint. opening channels of pegged token that dont even have an equivlent onchain confirmed funding

rebalancing should be free in channel factories, so eventually that cost goes away

then, the incentives are skewed towards running a personal node. that only drives fees down, as everyone benefits from better connectivity, and low fee rates encourage connections.

this is why alot of people promoting other cryptocurrencies are putting alot of effort into talking about lightnings downsides: lightning being cheaper than their coin in a clear and simple way makes their sales pitch harder

Then in that case there's still liquidity provider staking Bitcoins in LN.


Are you really that of a moron? Or do you believe everyone reading that are gullible morons?

Newbies, there are no "pegged promises to pay IOU tokens in Lightning". But franky1 has "read the code", listen to him. 8)

again windfury offers no code, no dev quotes, no stats.... just social drama and insults that just narrow down to "wrong coz franky" which is laughable, weak and empty of any valid counter argument.

research thor turbo. they open channels without having a confirmed locked CLTV tx on the blockchain
thor let people pay them fiat/alt/coin in coinbase.com balance(mysql database) and INSTANTLY open a LN HTLC channel measured in millisats of the token they designate represents btc. (the pegged IOU)

meaning there is no 'bitcoin' just a IOU agreement (htlc) measured in a token only recognised on the LN network

the way it works is that thor turbo give a user a millisat HTLC (HTLC's do no broadcast) so the user just treats it as IOU balance and when it comes to settling it does not touch bitcoins blockchain. it does not get broadcast. instead the user requests thor to settle out. and thor then decides to hand any fiat or altcoin or whatever payment method the user is owed.

learn about this stuff. seriously.
if you want to promote/defend something. atleast learn about it

I've looked at Thor Turbo (still superficially, may have to re-read) but I think what you write is incorrect.

Even if there were "eternally unconfirmed" Lightning Turbo channels where "coins" have been moved before confirmation, this only affects the Bitcoin balance of the channel created by the unconfirmed transaction. Gains and losses for the involved parties would equalize, and all other channels would continue to be backed by confirmed transactions.

There is no possibility of fractional banking or "creating coins out of thin air" with this scheme, imo.

research further
you can 'buy' balance using coinbase user account balance (no onchain tx)

also when you look into factories... HTLC's.. ln not being a consensus/blockchain network.. and the fact that the HTLC contracts are not even community audited thus can be made out of thin air. you will see that things are not as network wide fixed/ruled as you think

But what you offer is claims that you did all the "research", and post all the confusing techno-babble, but end up with "there are IOU pegged promises to pay tokens in Lightning". There are none.


You don't need to get things straight, I AM THE BIGGEST MORON in Bitcointalk.

Newbies, listen to franky1, and Khaos77. Welcome to your Bitcoin journey. 8)

msats are not techno babble
its a word for a economic unit of measure thats 12 decimals. which the bitcoin network does not accept or recognise.
its a word for a economic unit of measure thats 12 decimals. which the LN network does accept and recognise.
nothing technical or babbly about it

windfury without you doing any research or learning, you keep repeating how you think there are no pegged tokens or iou's
but your lack of knowledge is just digging yourself a hole and not proving a point. in the end there is no point you repeating your mis-information because you have not even bothered or tried to check on reality

And you should re-read the second part of the sentence you marked in red ;)

This isn't the case imo. The "coins" in the unconfirmed channel are only of relevance for the relation between the people that have opened the channel between them. For the Bitcoin blockchain network, they don't exist, and for the Lightning network as a whole they're irrelevant.

Example: If node A and B open an unconfirmed channel via Thor Turbo and node B is connected via C to other nodes with regular channels based on confirmed transactions, then every payment done by A, from the point of view of the network, simply converts into a payment done by B. A can only pay if B provides the necessary liquidity in the B<->C channel.

So even if B was a "bank", it couldn't create coins out of thin air - it has to provide all necessary coins for payments in the "real" Bitcoin network.

You are referring to this issue (https://www.reddit.com/r/btc/comments/7tmedp/coinbase_will_offer_lightningconnected_custodial/) (coinbase as a "leaf node"), right?

This has nothing to do with LN - it's basically what all exchange/wallet services that offer an internal "transfer to user" option can do. It would only become an issue if Coinbase (and similar services) was/were to bundle the majority of all Bitcoin users.

Is that a bad thing? And "the community" could always offer alternative Lightning solutions, if some LN wallet devs take decisions not desired by them.

nope. thats about coinbase running a service
im talking about a USER sending BITREFILL mysql balance of fiat, altcoin or btc.. emphasis mysql database balance, not blockchain tx. and then bitrefill just making a HTLC, again emphasis without needing tethered btc. but where the HTLC is measured in msats and is designated as a pegged btc
when the USER wants to settle. nothing is broadcast. but instead a request to factory(bitrefill) is made and its then upto bitrefill to reimburse the user in whatever amount was agreed. again this can be coinbase balance. thus not touching a blockchain.

what this means is LN is NOT defined/fixed to a blockchain, and its not even defined fixed to a coinbase account. anyone can write a htlc and a partner can agree on it for any reason

getting free/discounted balance people are gonna turn down??
i know many people wear rose tint glasses, rainbow boxers and hug a stuffed unicorn when promoting LN.. but knowing the negatives is just or more important

Here's the thing , To many people are stuck thinking that LN is a Alt, Service, or Fork. And hav'nt really checked it out I think its time to get #Loud & #Reckless and push more . It will be hellish for dev's at this point in time but might attract new devs and voluntary enthusiast/advocates.

Right now to much stuff is custodial since "everyday" user's are not opening channels/nodes.
 

As I understood Bitrefill (have never used them, but just read their FAQ), their channels are purchased separately from the "channel transaction" - you send a transaction to them and then they open a channel with you, sending Bitcoins from their balance to you.

The way you pay that is irrelevant. They simply use the Bitcoins they own (e.g. those other users used for payments, and surely some reserves) to fund the channels. They charge a pretty hefty fee for the service (maybe financing their  channels partly with that), so I doubt I would use them just to check that out ...

If one can buy a channel via Coinbase balance then that probably simply means that Bitrefill also has a Coinbase wallet, so Coinbase user can send them MYSQL balances (as you call it). They may withdraw the coins from Coinbase if they need real Bitcoins, but that's something obviously hidden from the user.

If that's false, please send me a link where that issue is discussed. I for myself cannot find nothing strange.

But then it's not Lightning but a simple Mysql wallet service. AFAiK "Thor" is a real lightning service where they send a transaction to an address you own. They require a "real" Bitcoin wallet for that.

You can write any HTLC you want, but in the case there are no Bitcoins covering them, then nothing protects neither of both parties. But: HTLCs are between two parties, and only affect what happens between those two. Even if it's a group of users (=channel factories) then people outside of this group aren't affected. (I doubt someone would use a channel factory where the opening transaction isn't confirmed!).

In theory the Lightning software surely could be written in a way that you could route payments via an offchain channel opened with an unconfirmed transaction. But every LN sender could see that this channel is unconfirmed - I wouldn't use it as the HTLC protection in this case is non-existant.

My opinion is still that LN isn't a service for every Bitcoin use case, but for small payments it should work well, as long as a channel can be opened and closed for a reasonable transaction fee.

I'm aware of "millisats", but it doesn't change the fact that there are no issuers of "IOU pegged promises to pay tokens" in Lightning. No one deposited something somewhere, and were issued something worthless. They are actual signed transactions by both participants of the channel than can be broadcasted and included in a block in a later time. It's like a smart contract between two people.

Where is the issuer of IOUs there??

the issuer is the parties themselves. THEY create the HTLC themselves
HTLCs do NOT get treated like a bitcoin blockchain CLTV tx.
HTLC's do not broadcast to a blockchain

pegged token networks do not need a central company to make the tethered pegged tokens..
in LN anyone can make pegged tethered tokens.
in LN anyone can make tokens that are not pegged/tethered

the only reason some of the pegged tethered token networks use a central company to be the sole issuer instead of letting users do it themselves is about making a company accountable.
by not having a centralised issuer does not mean that pegged tokens dont occur. it just changes who is accountable

Wind_Fury gave a simple, basic definition. The highlighted part is the part open to interpretation depending on which side you want to take. Franky keeps doing his "I owe you" thing. Hope i can get some understanding from this clash.

The bitcoin that get "locked up" in a multisig addresses are there to create "channel capacity". These Bitcoin are recognized and settled on the Bitcoin chain by opening/ closing transactions. So, i think unlike what franky keeps insisting, there really is bitcoin involved and not some separate coin. While this channel is open, the two parties agree to update their respective ledgers in a P2P manner without having to ride the main chain. This helps in micropayments and you avoid paying the higher fees.

Maybe, the basic point of contention here is "Channel capacity". The funding transaction to receive a payment is the first step of this "chicken and egg" problem. This isn't such a big issue when you want to spend though.


Franky you have based your argument on two things:
1. Insisting on calling HTLC an IOU document and
2. Introduction of msat/ miilisat.

The non-dramatic view on msat is that it is LN's answer to the apprehension that 1 Satoshi would be too much for micropayments if BTC price gets high enough to save Good'ol John from eating his dick on live TV. Calling it a separate coin is disingenuous and misleading. This maybe your understanding of course, and you may feel strongly about it because of the scaling debate going the LN way.

Its not an IOU because receiving/ sending LN payments does not mean you are receiving/ sending debt. At any point, the amount i can receive is limited by the "channel capacity". Please correct me if this is wrong.

also, the full dev-quote on the msat thing is:

It doesn't mean that LN payments cannot be settled, it only means that if the channel partners desire to settle, it will be rounded to nearest Satoshi. (lower value of course)

th problem with widfury is he merges 3 questions/point into one sentance and when addressing the points he just changes the order of the points to try making it seem different but is him just repating himself

the 3 points are
tokens created . not using real bitcoin
the iou
who is a central issuer of such

so dealing with these 3 points separately.
1. Msats are a token NOT recognised by a blockchain thus LN is not using real bitcoin. bitcoins never leave the blockchain. Msat balance is created when a HTLC is created. Msats creation/utilisation are a token that doesnt even need to be tethered to a bitcoin transaction

2. the HTLC because its not an actual bitcoin asset but a different denomination/token. because its not even getting settled. HTLC's function is just to say who OWES who what, where by at a later date the parties then agree to settle the debt
EG i can put up a pair of $60 sneakers(shoes) up as collateral. and i and a friend can both agree to a HTLC of 1200000000msat total balance and then over time we agree on who owes who what. then at the endwhen one side shows they are owed th balance of a full pair of sneakers the person that is owed the sneakers gets them

to address amishmanish's query about 'limited by channel capacity'
the collateral does not have to be bitcoin locked transaction nor anythinglocked/community ruled/centrally accountable.
the msat balance(capacity) does not have to be locked tethered to anything
the msat balance(capcaity) can be increased/decreased at any point
a htlc of msats is just a 2 party IOU agreement, it's just a private agreement by those 2 parties. meaning as long as they agre to it whatever it is thats the iou agreement they are agreeing to.
 
which if you can trust that it will get settled, later on gets settled.. but no guarantee.
even converting a HTLC to a bitcoin CLTV tx (should the particular instance be based on btc collateral)
does not guarantee that the CLTV broadcast would get added to a block/confirm/settle up as desired.
so yes indeed the HTLC is a debt balancer of who owes what, whether there is collateral or not

3. seems winfury cant counter point 1&2 and is now trying to meander in the 3rd point pretending that pegged/tethered /collateral or uncollateralised tokens or iou's can only be created by central issuers. thus with his lack of knowledge/ ploy to be subtly saying there is no central issuer he believed that there can never be such a thing as pegged tokens/iou tokens/unpegged token creation. which is another flaw in how understanding.

Welcome to the "Stupid Club". 8)


I didn't "meander" anything, I simply NEVER agreed with you from the start about your claims that there are "IOU pegged promises to pay tokens" in the Lightning Network. What you cannot live with is that you're wrong, and everyone is starting to see that you're wrong. The same way I believed you and Jonald Fyookball about "big blocks are good", and discovered that Gavin, Mike Hearn, and Roger Ver had become malicious.

But I believe that I might have once agreed with you that Lightning was an "IOU system", and also learned that it's not. The hard way.

here you go again spewing out the "big blocks" stuff... you have been so spoonfed by your echo chamber that you dont even know whats real anymore.

i have never been in the "big block" camp. so it seems your buddies have ben whispering so much crap to you that you dont even know whats happening.

as for your research into LN/bitcoin. after months of u saying 'theres no iou' you have not even bothered to read code, use LN or anything. you cant even counter argue beyond just saying an empty claim of basically, 'wrong coz franky said it'

you have been given plenty of time to actually look into it. but you have refused. so that is a flaw on your part.
goodluck with your head in the sand mindset. but one day i hope you wake up

P.S
'wrong because gibberish'
'wrong because franky'
'wrong because techno babble'
are empty counter points that only proves you have not/cannot come up with a valid answer

if you ever want to counter someone. use stats, code, data. if you cannot. then just hold back from pressing the reply button until you can

Excuse me, every technical argument about big blocks are something that should be considered, and the reason why I brought that up was to prove a point that you sided with the people who have gone malicious, and wanted to undermine Bitcoin.


Never? Then do you believe the Core developers were right to hold the hard cap to maintain small blocks? You were not debating for Bitcoin Unlimited?


I did, and what I found was that you are simply wrong. There are no "IOU pegged promises to pay tokens" in Lightning.


You brought that on yourself. But I hope all the newbies listen to you and learn. The hard way.

if you dont understand that Msats are pegged tokens
if you dont understand that HTLC's are just agreeing who owes who wht but a HTCL is not and will never 'settle'

then you have not learned anything about LN

as for your over meanders about bigblocks and altcoins.. my stand is about scaling BITCOIN. not deburdening BITCOIN and scaling alternative networks

Please name the Bitcoin users who give the slightest shit about your stand.  You keep thinking that everyone agrees with you, so surely you'd have some idea of who some of those people might be, right?

For all your talk of doing what is best for Bitcoin, you do nothing but attack the path that users on the Bitcoin network have empirically chosen to follow.  I'd tell you to find some people who agree with your stand and form a network with them if you don't like how the people on this network have decided to go about scaling, but it's pretty obvious that anyone who might agree with you has already forked off to one of the altcoins you don't want us discussing.  If people are drawing comparisons between your stand and those altcoins, the reason for that is that your stand is not compatible with the rules other users on this network have chosen to enforce.  Your stand is empty, hollow, insubstantial and ineffective.  Your stand is not recognised or acknowledged by the Bitcoin network.  If you want a network that isn't "deburdened", there are other networks catering to your desires.

typical mindset. you say 'find people that agree', which is your subtle a foolish mindset flip flop thinking that no one disagree's with cores roadmap. sorry but this very forum shows hundreds of people disliking the fee wars, transaction throughput limit and that cores roadmap is trying to deburden bitcoin while falsely advertising it as 'scaling bitcoin'.

your mindset is also foolishly thinking that if people dont want to deburden bitcoin, those people should leave the network and make another network.
it seems all you think as a solution for the bitcoin network is for people to stop using the bitcoin network.. (facepalm)
as for saying those that have opposed cores roadmap have forked off.. im sorry to inform you that core forked some opposition off the network by controversial splits. but them people do run a core node even if they dont like it.
just because cores software is the only on that satisfies all the requiremnts of bing a full validation/full archival criteria, does not mean those using it are core loyalists. it just means they dont want the drama of REKT campaigns and mor mandatory splits, so just give in

your belief that running a core node means adoration and loyalty is your flaw. and may you wake up and realise your foolishness one day.

blockchains and bitcoins are about progress through unity and agreement.(consensus).

if you think that all disagreements should result in totalitarian control and apartheid law. then please do yourself a favour and learn the invention satoshi made. learn the meaning definition of consensus, then learn about the byzantine generals theory and how that was solved. hint. a method of mutual agreement, not division and factions

Yes Via OpenNode.co first 10,000usd transferred freely, -(Custodial But generates the capability to set predetermined donations/payments portal) its basically bitpay for LN
Many LN site builders are utilizing Opennode LNinv generation for basic site operations. (basically they are just porting)

Bitlum.io is a "casual-user's" solution to LN for the time being.Its a browser extension wallet that also offers exchange LN to BTC or BTC to LN "Dual" wallet.   again its -(Custodial)

Says the person who seemingly doesn't agree with a single thing happening on this chain.   ::)  

How is it you expect everyone to agree when you can't yourself?

The extraordinary dichotomy of a dissenter who follows a blockchain he fundamentally disagrees with.

Astounding.



Then they can run different code to show that they disagree.  That's the entire idea, isn't it?  You run the code that enforces the rules you want.  But if people do run code that isn't compatible with the rules on the Bitcoin network, they might find themselves leaving the network, either by their own choice or by other users' choice.  And this is what it boils down to.  How is it you think you can enjoy the benefits of the security and the network effects provided by this network if you run code that has the potential to remove you from the network?  You can't have it both ways.  Either you agree with the transactions that are included in the next block and you're part of the network, or you disagree and suddenly you aren't part of the network anymore.  Anything beyond that, you're just running your mouth.  Prove your ideas are viable.  Then I'll take you seriously.  But you'll never prove it.  So I'll never take you seriously.  It's as simple as that.

People on these boards do have an unfortunate tendency to trash-talk certain forkcoins, but at least those users who forked away had a strong enough will to run code that enforced the rules they believed in, even if that meant giving up the advantages provided to them by using Bitcoin.  That puts them several orders of magnitude above you in terms of the respect they're due.  You just linger around like a bad smell, mouthing off about all the things you could change, but won't, because you know you'd have to do it on your own.  

You know you're never going to leave this network by choice because you don't have the support you need to build a network that could even survive, let alone implement all the totalitarian crap you'd like to see.  So you just sit there sniping at things you don't like but completely lack the spinal fortitude to take any real action to change them.  So here you are.  Business as usual.  Impotent but loud.  Unable to change a thing.



Your default position is that Bitcoin is being "deburdened".  It's not realistic for you to assume that everyone feels that way about off-chain transactions.  Many would be happy enough to just keep using Bitcoin as they currently do and simply not use Lightning's functionality.  But yes, if you are fundamentally ideologically opposed to something you can't possibly hope to change (and it seems that you are), what the hell are you even doing here?  It goes without saying that you'd be better off leaving if you can't even accept the existence of this technology which you appear to blame for denying you your precious on-chain scaling.  If you believe on-chain scaling is better, why not use another chain where the users opted to focus on that?  Maybe it's because it's not better.  It's only better if that chain with the on-chain focus has equal security and network effects to Bitcoin.  But none of them do.  And they probably never will.  So I'll say again, here you are.  Again, business as usual.  Again, impotent but loud.  Again, unable to change a thing.



What you think consensus means is observably untrue.
  
You tell us consensus means voting.  Proven false by observable events.
You tell us consensus means everyone has to agree.  Proven false by observable events.
You tell us consensus means we have to wait for features to activate to decide if we want them or not.  Proven false by observable events.

Everything you have ever told us about consensus is false.  All of it.  Every last word.  I'd tell you to learn consensus, but you could spend the rest of your life trying and you'd still never get it.

doomad bitcoin/blockchains as used 2009-2013 were consensus based. but then came all the REKT campaigns consensus bypass crap. which is what i highlight.

also you as a flip flopper like to twist things.
YOU say consensus has to be everyone agreeing(then say no one has to agree due to 'no permision'). in actual fact consensus has to be majority agreement to such an appropriate level that the opposition does not cause controversy.

consensus is made from the word to consent. so yes indeed it is a vote of community.
however you prefer to cause controversy by suggesting getting rid of opposition before consensus can even be reached, just to fake majority.

consensus is not about faking a vote to activate a feature. consensus is about finding a feature that the community can as a majority rally around without controversy, without mandatory splits. where by the network progresses via positive code and features that the community want.

again you prefer to split the community and tell people to F**k off the network if they dont like core.
that is not consensus.
saying that core should just be totalitarian and do as they please and force thir feature in because they dont need permission and there should be no vote/consensus.. is your failing

YOU have been very pro core (not bitcoin)
YOU have been very pro deburdening the network(disconnecting non core nodes, fee wars, opposition forks, pro LN)

YOU show lack of understanding of bitcoin, lack of care for the bitcoin network. you just seem to want to play the PR game of do as core say and not as a wider bitcoin community would like.
and dont pretend that everyone is core loyalist and there is only one opposer left. because you are just making yourself look foolish

how about you stop trying to be a core ass kisser and start being a bitcoiner.

franky1, listen. You need to update your understanding of the Lightning Network. You have been using the same debate that it's an "IOU system" from 2 - 3 years ago. You are simply wrong.

In Lightning, not one user "deposited" Bitcoins to another party, and then issued with a worthless token. They are actually signed transactions made by both participants of the channel that can be broadcasted and included in a block in a later time. It's actually a smart contract between two parties.

The newbies are beginning to understand, https://bitcointalk.org/index.php?topic=4792622.msg50781071#msg50781071

Always DYOR.

windfury
learn the difference between a CLTV contract (the lock/vault) and HTLC(the iou/pegged denomination). they are 2 different types of contracts/agreements.
as for saying my info is out dated. sorry but playing with only CLTV was the old crap. now they use HTLC for the payments which is where new things like factories and ELtoo come into play, as well as turbo funding and no collateral funding channels to allow instant use without confirms and such.

please its of benefit to you to really try to learn LN
as for saying there is no token issued. again check out msats

You guys should stop arguing here, @BitCryptex made this to be educational and informative.

Ok, I will do my research and ask around. If this is another one of your misinformation, then I don't know why you're doing your misinformation rampage.


Sorry if our debates annoy some of you, but it's also an educational experience if you do it, or follow the debates.

Here's something franky1 said, help me do the research on why he believes Lightning is a network for "IOU pegged promises to pay tokens",


He's usually gaslightng, but it's good to always give someone the benefit of the doubt and verify for yourself through research, if the information was correct. 8)

throwing out the word "gaslighting, misinformation, fud" as your repetative response. does not actually prove a damn thing apart from show you have not done any research

again
learn the difference between a cltv and htlc
learn about msats
learn about factories

JUST LEARN!!!
dont reply until you have learned
dont reply saying personal comment as a response to delay why you have not learned. just go and learn this stuff
dont reply trying to twist the conversation into a different meander. just go learn this stuff

and if you are going to learn by chatting to a echo chamber of friends. ask them for CODE, data proof. and if they can only reply saying "gaslighting, jiberish, technobable" then they are not explaining the tech they are avoiding explanation and just trying to avoid teaching. so go else where and learn independently

do not reply to me.
go learn about LN and then make a full descriptive reply explaining msats, HTLC factories.
only counter the details of msats, htlc's, factories when you have learned about them.
again dont reply to me about the why's and if's and the whos's of 'franky1' just talk about LN and msats, factories, HTLCs

have a good month

if you reply to this topic in the next 2 days then you have not given self adequate research time.
if you reply just to comment about my comment you have just been ignorant to the point.
if you want to discuss LN LEARN LN

I will repeat and repeat, until proven wrong.


I WILL learn, and I hope I won't be disappointed to "learn" that you're gaslighting again. 8)

Newbies, DYOR with me.

Plus on the real topic, Lightning Labs' desktop app is out of testnet, and live with an alpha version.

https://bitcoinmagazine.com/articles/out-of-testnet-and-into-alpha-lightning-labs-desktop-application-is-live/

with LN
Neutrino is a compressed blockchain of all tx's... making a 1.4mb block appear as 20kb (70th of the size)
yet requires full nodes to go through a process of re-orging data, compressing it. and sending it.
yet the receiving LN node doesnt need to know about every spent/old tx of history.

what would be more practical, task saving, data size saving and less demanding on full nodes. is to use the UTXO set
not only is the current UTXO set less data than what neutrino compressed data would be.
but the information of UTXO is already readily existant in fullnodes(doesnt need new code/new database/new re-org protocol/new encryption)
the data contained in a UTXO set is more directly what LN wallets need to view(locked funds aka UNSPENTs)

so why create a new protocol/dataset for full nodes to have to process and manage, when they already have a dataset that provides the more direct data LN would need.
seems too many want to re-invent the wheel and try turning a bike into a trike and then a car then a truck(more wheels) instead of just using the well balanced wheels of a simple bike more efficiently

In terms of scaling, it should go without saying that the vehicles with a larger number of wheels do tend to have a larger capacity.  So thank you for highlighting the very reason why we're doing what we're doing.

i got to laugh
much like core fans shouting about 4mb weight, yet the 'scaling capacity' does not = x4 tx throughput
which is my point. spending too much time re inventing a wheel to pretend its a better wheel rather than using the well balanced wheels of simplicity and scaling more efficiently

You have been criticizing protocol developers' solutions, but we haven't heard any better suggested solutions from you. What would be your proposal?

By the way, can you explain how Lightning "issues" IOU pegged promises to pay in Lightning? I want to learn more. Let's pretend I believe you.

LN is less secure than blockchains. LN requires more then one channel and requires other people to be online to agree to a payment. LN is not a straight 'push payment' . there are more 'if's and non-guarantee's of success with ln. and more ways for people to steal funds from eachother aswell as ddos each other

however bitcoins scaling is not just about 'bigger blocks'
1. fee priority = spammers with under X confirm should pay more then those with XXX confirms. thus spammers become forced to use LN as it fits their niche. and average joe ends up paying less ONCHAIN than spammers
2. linear sigops. = reduce sigops limit helps propagation times, it also prevents bloaters making harmfully large tx's. thus allowing more tx per block without having to mak such bigger block sizes
3. hardware limits = have a type of 'hardware speedtest' as part of a node that rates a node. when majority reaches a certain level its then safe to increase the blocksize


you have already been told the difference between a CLTV(btc network tx) and a HTLC(ln payment that does not broadcast)
you have been told about btc and sats.. and how Msats are not btc/sats.

now go research

No one can refute the claims that Lightning transactions are less secure than on-chain transactions because it is correct. I personally never said it's as secure as online transactions, as far I can remember.

But as long as it doesn't change anything in the consensus layer, I don't care what developers do to build on top of Bitcoin.


Ok. I can't say or debate or argue if it's good or bad. But you have a right to express an opinion/solution.


Opening and using a channel requires an on-chain transaction. I can't understand how producing conditional statements, HLTC, in payment channels create "IOU pegged promises to pay tokens" in Lightning. Make us understand.

Updated, thank you. I have just finished all of my exams so I will check if there are any outdated information in this thread in the next couple of days.


I don't mind as long as the moderator doesn't close this thread without prior notice. This would make me unable to edit it in the future.

opening a channel(HTLC) does NOT require an onchain transaction(CLTV)
a LN channel can b opened by simple agreement of the two parties.
a CLTV is just proof of one form of collateral. but the 2 parties can agree that the collateral is not btc but anything they agree on.
this is where factories and 'thor turbo' come into play as examples, because a party can create channels using coinbase balance or literally any form of collateral and the other party simply agrees to it.

Msats are the token of LN

Msats are not bitcoin medium. the bitcoin network does not recognise Msats. Msats are the pegged token created to represent collateral
who owes who what amount of Msats is by very function and definition an IOU.

instead of asking me to repeat the same thing in different topics and you spam the same lame reply just to boost your sig campaign post count. please try to do some research on the topic

That's true. No one said the coins were leaving the blockchain.


Let me stop you there before you break your fingers on your keyboard in excitement.

The Bitcoins are held in a multi-sig address as long as the channel between you and someone is open, in which Bitcoins can be transferred between you and someone through the channel. The term "off-chain" is really an imperfect term.

There are no "IOUs". They are essentially signed transactions by both participants of the channel.


That's confusing. Your post doesn't show how producing conditional statements create "IOU pegged promises to pay" in Lightning.

For someone who claims to be "smart", you sure are gullible. Who wrote those blogs/articles, and are they qualified to write about cryptocurrencies at all? Haha!

But newbies, listen to Khaos77. Learn about Bitcoin and Lightning. The hard way. 8)

The direction you guys took this topic detoured any real progress of educating the masses specially noobs.
You've proven that LN is in-fact #Reckless
You guys pretty much so hijacked OP's post with arguments instead of FAQ's and for a project like LN this is not acceptable.
We got to work together to reinvent the wheel.
Can we get this back on topic?
 I've been refreshing new replies to this post in hopes to help someone with valid questions but you guys keep going back a forth.

I do I want to Help!!!!

Incorrect.

LN is a name given to a method of using Bitcoin transactions in one particular way. Bitcoin consists of transactions that can be signed and broadcast over the Bitcoin network. There are many reasons to sign a transaction and keep it offline until a later date, and LN simply takes advantage of this ability. Bitcoin has the ability to create 2-of-2 multisig transactions where you simply delay the broadcast. If you consider this basic usage of transactions a different "coin" then practically every Bitcoin transaction that has happened is a different "coin" and every smart contract that ETH uses that hasn't been broadcast yet is also a different "coin" for some time, which would makes the term fairly meaningless. In terms of cryptocurrencies, using blockchain transactions of said coin that are sufficiently mathematically and cryptographically secured by a specific blockchains should be considered to be of that specific coin. This helps us use the term with relevancy when talking about a coin or alternative coins.

LN is a very cool "smart contract" of plain-old regular Bitcoin transactions on the Bitcoin chain.


Incorrect.

It's important to distinguish a banking IOU or fractional reserve IOU in it's most nasty feature: it can be fraudulently denied or withdrawn and requires trust in the hands of the banker. A major point of LN is that it requires zero trust. It is secured mathematically and cryptographically, since it is using Bitcoin transactions with a protocol that cannot be broken (minus any bugs, but that is the same of any nascent technology). Due to this, you cannot "fractionally" give someone more coins as if you have more coins that you do. This is what banks do.

With LN, you must prove that you own the Bitcoin you are transmitting over the LN by signing the transaction correctly which is then verified by the other node. If you pretend to have more coins than you claim, the LN funding transaction would simply fail (which happens on-chain to prove it).

LN is far from an IOU in that (most critical) sense. You could consider every Bitcoin payment an "IOU" on a magical global ledger, but again the term becomes less useful for the purposes of talking about cryptocurrencies. Since you cannot counterfeit, charge-back, or abandon any promises of payment with Bitcoin transactions through mathematics and cryptography -- it should be considered just hard money. The same is with a LN-type of Bitcoin transaction -- there is no way for a party to perform the same tricks of an IOU of a traditional bank.


Incorrect.

LN-implementation of Bitcoin transactions is second-layer technology, and as such, Bitcoin Lightning Network cannot be used without Bitcoin. Bitcoin LN is a particular way of using Bitcoin. LN technology can also be implemented on other cryptocurrencies with the same mathematical security. For example, Litecoin has also implemented LN for their chain.


Incorrect.

See above. There is no representing here. It is purely regular Bitcoin transactions, and there are no other blockchains or coins involved in a LN-type of Bitcoin transactions anymore than there is involvement of other coins when doing a pure 2-of-3 Bitcoin transaction or a m-of-n Bitcoin transaction. It's a particular type of multisig transaction, nothing more. It just happens to have a really cool name, and it operates with mathematical and cryptographical security (Zero Trust) without clogging up the chain (yay, scalability!).


Incorrect.

Your bcash favoritism seems to have leaked there with your use of "segwit coins". Bank notes have a fundamental flaw in them, in that they require trust. Bitcoin eliminated that need for trust, and further, Lightning Network ensures that we don't lose that hard money security by also not requiring trust. This is where your comparison truly breaks down.

Bitcoin is extremely powerful because of the fact that once I own the private keys, there is NOBODY who can deny me the coins. Lightning Network is powerful for the exact same reason. That once I have made a Lightning Network transaction, there is NOBODY who can deny me the coins. We get the same level of security, with an awesome level of scalability, and even bonus benefits in privacy.


Categorizing cryptographically secure transactions that cannot be revoked by others is the furthest away from "offchain bank IOUs" that I can think of in terms of transactions. It's important to understand the security around the technology and the fact that it does not leverage any other chain other than the one it is implemented with.

This reply is not meant for Khaos77 because it seems there is some ulterior motivation for someone to be this incorrect about a technology yet seemingly so confidently wrong. In this case, I'm not here to start an argument - but I simply want to give people a chance to understand Lightning Network on their own. I, myself, may be incorrect about some of these things, and I hope that other Lightning Network experts can chime in. This reply is meant for anyone else watching the thread.

Now, I have to get back to writing code. Have a nice day!

I hope your coding is better than your understanding of reality.  :-*

Because the only things incorrect was everything you said.   :D

Since my original post was correct, just reread my post as a rebuttable to your nonsense.


FYI:
I like Litecoin over Bcash, so as usual you are wrong again.
LN offchain fractional reserve IOU system also works with litecoin and litecoin has onchain transactions capacity to spare.  ;)
History Note : Segwit activated on Litecoin before it did bitcoin.

FYI2:
What is funny is that Tim aka micolancer.
https://microlancer.io/about
One of his Idea Contributors
Renepickhardt
Is the same guy that is proposing adding code for adding fractional reserve directly to LN.
https://www.rene-pickhardt.de/index.html%3Fp=2131.html
Now that is rich.   :D

Guess Tim is a little clueless about the reality that he resides in.

*WhyFhy love Tim so much , because he ran a sig campaign for him.*
https://bitcointalk.org/index.php?topic=5125748.0

Thanks for dropping in Tim! Very educational :) even for me xD

i found this article talking about how tor could make running a bitcoin lightning node easier.
what do you guys think?

Yes, thank you for explaining it like you did, Tim, whoever you are. I wish I was as eloquent, and as smart as you. But I am not a coder.

Whyfhy, sorry, but I have tried to explain it with the most detail as my stupid brain can explain it in the past. But sometimes it becomes like talking to flat-earthers who deny the truth. I hope smarter people in the community would drop by, and post more and memefy the deniers of the truth. 8)

Your fine,  this turned into a "Infrequently" asked questionable debate. Now I think we can get this topic back on track. P.S. i brought Tim here to squash it , he's my LN FAQ guy. and a great teacher.

seems microlancer is sidestepping the LN flaws to only talk about LN in utopian conditions.
its similar to saying banks cannot be robbed because an ATM requires a card, pin number and has a $500 limit
(totally ignoring the big picture outside standard practical/utopian use of banking)


LN channel partners can agree to a channel without needing a locked bitcoin network transaction (CLTV)
its how turbo and factories are concepted
the unit of measure in a channel(HTLC) is MSats.
HTLC using Msats cannot be broadcast to bitcoins blockchain
Msats can represent any value. whether it be a calculated btc balance, a coinbase mysql fiat balance or a pre agreed private value between the 2 parties

LN is not a community protocol. it has no global consensus. users can set up thier own rules and protocols between themselves. this is why LN is so fluid with all the different things being tried out like eltoo, factories. because they can play around with things privately, in small groups, etc.

i can re-write my node to accept or decline whatever i like.

He is not. Those are facts you have repeatedly been denying.


I can set up a Lightning node, connect to another Lightning node, and fund a channel without an on-chain transaction?

if the other party agree's to it yes
the 'collateral' of a channel does not have to be bitcoin.

remembr this simple fact.
when you set up a channel. that channel is NOT relayed around the network to have the community verify it.
its just a private agreement between you and someone else.

its how channls can be st up where the collateral is things like coinbase database balance (not a blockchain)
people can decide their own agreement of collateral

again you really need to start atleast using lightning and learning about it if you really want to get involved in conversations about it.
i still find it strange how you get involved in things you dont know or never used. its like you are just interested in the social drama you can cause.

please try learning about LN. and not the utopian perfect condition hype. but the actual usage and issues and limitations it comes with.

I can host a poker party where we play for matchsticks, but it wouldn't have any negative impact on the other poker games where they're playing for money.  What's your point?  You clearly aren't going to be able to settle to the Bitcoin blockchain if you modify your client to do this, so stop lying about Lightning supposedly enabling fractional reserve when it doesn't.

Is the agreement opt-in only in the Lightning Network?


Incorrect. As how Lightning works, a confirmation is required when funding a channel.


I'm confused. What are you talking about?


No, it's you. You love the social drama. "Because Core, because Core, because Core, they are evil bwaaahh!, they want small blocks, bwaah!"


Can you do a demo that can show us that we don't need a confirmation to fund a channel in Lightning? It would help this topic.

THOR TURBO
https://www.bitrefill.com/thor-turbo-channels/?hl=en

you already been told about this several times, ..
dont be ignorant/arrogant. try to research instead

https://blog.bitrefill.com/the-hottest-lightning-network-tech-features-for-2019-and-beyond-dbaaac6ddfa4

I'm arrogant for calling out your lies and misinformation? Haha.

I have also got in contact with someone from Bitrefill. He said that you are nothing but a fudster. But I'll ask their representative in the forum to explain how Thor Turbo works and memefy you. Again.

But newbies, listen to franky1 and learn. The hard way. 8)

Their post here (https://bitcointalk.org/index.php?topic=5130122.msg50947683#msg50947683) explains things pretty succinctly.  And given that Lightning now forms what I would assume is a fairly integral part of their business model and they use it on a daily basis, no one seems to have felt the overwhelming compulsion to tell them that they need to do more research.  Funny, that.   ;)

He's memefied. Haha.

But for the sake of the newbies, let's bring Bitrefill in here and explain how Thor Turbo actually works in more detail, and to explain in layman's terms, and how it's good for Lightning users and Bitcoin. 8)

bit refill go into detail about msats vs sats.. i dare you
by this i also mean the detail of cltv vs htlc.. i dare you

dont blanket over the details. actually explain how LN functions in the process of
locking funds onchain.
how LN as a separate network decides what/when/if a locked funds tx is valid
then explain how the LN part of 'pushing' payment occurs. including what denomination/tokn is used and if that denomination/token is broadcastable.

dont try skimming and hiding and ignoring the difference between htlc and cltv. dont try to make it sound like only cltv are ever handled.
actually explain it fully.
remember to explain how if there is magic that only permits 6confirm locks to be collateral. how your system breaks the magic to allow 0 confirm collateral, or where users can buy in using coinbase balance/altcoins.
or you can admit there is no magic and that channel partners can agree to whatever they like as the contract/iou is btwen them and only them(no community audit of LN agreement)

---

too many people only talk about the on-offramp in and out of bitcoin for small case scenario of bitcoin utopian utility in setting up/closing channels. but everyone is missing the point of this topic. which is about LN specifically. not the bitcoin on/offramp


anyway.. for those wondering if windfury even cares about bitcoin. or is just a core kiss ass... here's windfry's opinion on bitcoin
he actually thinks people should stick with fiat (facepalm). let me guess he thinks bitcoin is not digital cash but LN's Msats are? as its very apparent h feels bitcoin is not a viable currency and how only LN's token can do the job

I'm stealing a quote from amishmanish's post on page 3, https://bitcointalk.org/index.php?topic=4792622.msg50781071#msg50781071


You also got it the other way around, franky1. It's for you to prove that Lightning is an IOU system, because "msats, and other made up techno-justifications that developers cannot even understand".

You have proven nothing.

To keep everything in topic for this FAQ, newbies read,

"In Lightning, not one user "deposited" Bitcoins to another party, and then issued with a worthless token. They are actually signed Bitcoin transactions made by both participants of the channel that can be broadcasted and included in a block in a later time. It's actually a smart contract between two parties."


I replied to the original thread. Do not derail this topic.

this statement above does not show how LN works, but is just a wishy washy mashup of it kinda does this and kinda doesnt do that, all squeezed into a paragraph to basically mean nothing at all in complete context

you keep using things that make many random points that dont disprove anything as your counter to single items.
but lets try separating and individualising and translating the statement

1. in lightning no one user "deposited" Bitcoins to another party
 a. LN is a separate network. it has no blockchain. thus no bitcoin (unless you believe bitcoin can exist on multiple networks)
 b. lightning uses Msats, bitcoins remain on the bitcoin network(blockchain locked). no bitcoin is deposited to LN
 c. lightning channels are multiuser, bitcoins are locked into a multisig
 d. its not about 100% single user control

2. and then issued with a worthless token
 a. LN channels use Msats which is a token that is NOT recognised by the bitcoin network
 b. worthless/worth, is in the eye of the beholder. msats are not community audited, value is agreed between channel parties
 c. channels of Msats can be setup, agreed where collateral can be coinbase balance, altcoins, or anything human agreed

3. They are actually signed bitcoin transactions.
 a. CLTV multisigs are bitcoin recognised transactions. HTLC smartcontracts are LN payments. . learn the difference
 b. eltoo factories dont give channels the CLTV. just HTLC. its the factory(Server) that later signs a CLTV
 c. HTLC do no broadcast, are not measured in btc/sats and who owes what changes often without settlement

3c. understand it. if you have a 'agreement' of who owes who what. but its not settled. the the value is still owed. and all the agreement is, is a tally of who owes who what. the very definition of an IOU

seriously windfury. get out of the echo chamber of words and social drama.
learn the actual function of LN by using it. reading CODE,
please atleast just use LN before ever making another post concerning LN. then you can have a more practical discussion

Is it just me or has there been way less enthusiasm for Lightning in the past 1 or 2 months?

    I suspect that a good portion of people involved in BTC are either HODL's or traders. I don't see why a HODLer would think it is a good idea to wrap up much funds in LN, since it involves keeping funds in a hot wallet. Also, I am not aware of any major exchanges coming on board. If a few of them do, I can see lightning as an excellent way to arb. However, I think coming up with an easy way to handle the channels may be a challenge for a major exchange at this time.

Your debate never showed, or proven to anyone that the Bitcoins in the Lightning Network are "pegged promises to pay IOU tokens". You are throwing anything to the wall to see what sticks. There's nothing.

there is no bitcoin in the lightning network

ok lets word it a way you would appreciate.
you yourself believe that the btc network is the bitcoin network and all other networks are just altcoins that try to borrow/fake the name.
so under your own bias you have to accept that LN using Msats that do not broadcast to the BTC network. are a non blockchain crypto network of pegged coins.

Msats are not bitcoins

now windfury.
i gave up trying to tell you about code like "chainhash" because it appears your not a coder to be able to read it
i gave up trying to tell you about devs flaw admissions because it appears you cant be bothered to watch their videos
i gave up trying to tell you about analogies because it appears your imagination cant concieve any comparisons

so please if you want to continue your rhetoric. atleast use LN
i find it so strange you are so devoted to promote and defend it, jet show little to no knowledge about it.
all you keep doing is repeating things you dont know and then just imply "wrong coz franky said it" which is lame

so please atleast learn about what your trying to promote/devote your time to. because you help no one

in short
Msats are the pegged token. they are not tokens recognised by the btc network
HTLC contracts are not bitcoin transactions that broadcast to the btc network
HTLC contracts are private, temporary and UNSETTLED agreements of who owes who what. the very definitition of an IOU

By design.  It would somewhat defeat the purpose of it being off-chain if they were broadcast to the blockchain.  They're still not IOUs.  A commitment transaction is more binding than an IOU.

The clue is in the name.  That's why they call it a "commitment transaction" and not an "owed transaction", or a "promised transaction".

1. not being broadcast is the point. people need to realise that until its settled on a blockchain using a proper/native bitcoin transaction, not a HTLC, the balance is temporary and can get lost because people can go offline and lose their HTLC (even LN dev's admit this flaw) thus lose where they stand and how much who owes who what
(its why they envision watch towers and factories to middleman manage the IOU's)

2. a HTLC is measured in Msats
thus even if it was a really secured lock "commitment" (as you call it) is not final/milestone/explicit/settled
p.s HTLC is Hashed Time Lock Contract. i see you subtly trying to slide in a new buzzword 'commitment' but it didnt work
trying to avoid things like agreements, promises by then throwing in a new word to push the conversation further out. doesnt main the basic definition/function of a HTLC any different

its meaningless because what the contract represents is just a peg to real bitcoins. all a HTLC does is let users know a balance of who owes who what amount of collateral, without actually moving, involving the collateral... in short its just a tally of temporary position/temporary tally of who owes who what

Are you telling everyone in the forum to trust your word, and not the LN developers' word? Wouldn't your word make the LN developers, scammers?

Because I encourage the newbies to trust you, and learn about Bitcoin. The hard way. 8)

Last week, I've installed a LN wallet (Eclair) for the first time. It didn't all go exactly as I expected, but all in all I'm quite impressed. I've made more transactions in a week just for testing LN than I've made in Bitcoin in months. I'm convinced low fees for small transactions is what Bitcoin needs to grow (be it with LN or some other system).

Some of the unexpected things I ran into:
1. After funding the channel, I had no receiving capacity. I only got that after sending some funds.
2. The amount available to send was less than what I deposited. I first thought it was a reservation for fees to broadcast it to the blockchain, but later on the available amount went up a bit. It's still not as much as I've put into the channel.
3. I'm not sure how long the channel will stay open if I don't close it. Maybe forever, unless the other party closes it?
4. I have no idea how high fees will be to close the channel, maybe I can manually set them, maybe I can't.
5. Synchronizing Eclair takes quite a while after installation, but it also takes longer than for instance Electrum when I start it up.
6. Eclair somehow didn't use my full balance to open a LN channel, it left 600 satoshi in a change address. I'm pretty sure I chose to use the maximum amount, so it shouldn't have created Bitcoin dust.

Good things:
1. I bought virtual flowers on https://niffler.co/bitcoin-graveyard/
2. I painted a few pixels on https://satoshis.place/
3. I gambled a few Satoshis on https://lightning-roulette.com/ (my 100 Sat deposit never arrived at the site, I don't know why, but I'm pretty sure this isn't LNs fault)
4. I bought some Doge coins at https://www.coinplaza.it/ (this seems to be a great way to increase or decrease funding or receiving capacity of a channel). For this transaction I paid the highest fee until now (10 satoshi).
5. Most of the transactions worth a few satoshi were sent without any fee.
6. Speed! It took a few seconds at most to send or receive funds.

---

---

I dislike the "fighting" that happens in many LN-threads though. Some people like it, some people don't, but for some reason the people who don't like it feel the need to keep posting about it, while the people who like it feel the need to keep responding to them. Let me put it this way: as a Bitcoin user, I don't care if small transactions are handled by a centralized organisation, in a second layer, or on-chain, as long as it's low-cost. The risk is low anyway (because of the small amounts involved). I trust several organisations with much larger amounts than I'll ever put into a Lightning channel.

What I'd like to see, is a topic with just information about LN. I'm not experienced enough yet to make one myself, but I'd like to see one that's heavily self-moderated.

no on has to trust me and i seek no ones trust.. even read my footnote.


i encourage YOU to learn about bitcoin and LN. as someone else quoted they dont like the squabbling. but guess what. if YOU actually used LN you would learn more and actually be able to contribute to the truth rather than just repeated utopian promotional material you read from some certain echo chamber group.

if you dont even understand chainhash then you dont know about bitcoin/blockchain either, so please spend time learning that too.

if you dont want to learn the technical detail, then dont get involved in discussions about technical detail.

do not reply to me, if you dont like what i say hit the ignore button, but please just try learning bitcoin and LN
for months its been obvious you have no clue so it makes no sense for you to be getting involved in discussions about function utility when you personally have no experience.
you keep saying LN is not x,y,z but in the end your reason simply demotes down to 'coz franky says the opposite'
try learning what LN actually is and does, this means LEARNING, USING, RESEARCHING
then come back with a detailed opinion that includes actual content.
i have told you about htlc vs cltv
i have told you about msat vs sat
i have told you about consensus vs private 2 party agreement
i have told you about locked collateral vs private agreement

so until you can reply mentioning details about the same, dont even bother with the whole LN is not x,y,z but franky says it is

maybe spend some time being just a reader, not a writer. spend some time being a user not a promoter. spend some time being a learner not a ass kisser

have a good month. (use a month to actually learn.. not spam)

LN is not a fixed protocol network that uses a community audit mechanism, its a peer agreement which means its very loose. you will fin d different wallets act differently.
for instance bitrefill promotes a different wallet to address point 5 and 1 and 3. so try other wallets and to use one that suits you

1. again different wallets act differently. some are programmed to only scan the collateral network(bitcoin in your instance) after you try to make a payment
2.4.6 to keep a channel active there needs to be some balance.. some wallets use this as their 'punishment' fine. some use it where an amount is reserved for the collateral onramp settlement fee (bitcoins close channel tx) where by out of the two parties the broadcaster is the one 'punished' by sending first having to pay the fee
4. some wallets allow you to play with the fee's before closing. but some just lock a certain amount upfront which sometimes aint enough to guarantee a settled close session back on the bitcoin network

again LN is not a set network where its a community consensus of everyone following the same rules. so expect things to not run right all the time. its a very fluid network where new rules come in and out (too) easily
the only thing you can hope for are these things right now.

the network not being so popular so that:
you are not having to hop through multiple route parties which each hop adds complexity, uncertainty
having connections directly to the end service to get the cheap fast reliable experience

word of warning
some wallet open you up as route and open your funded channel as being full balance spendable by other routers. meaning people you connect to can spend you balance (especially if you use a feature called autopilot) without your consent.
many people get messed around with it

as for the squabbling.
some people have never used LN but strangely have an attitude they need to promote some utopian dream of LN. which doesnt help people learn about the flaws to let people know what they are getting into/risking.
most self-mod usually end up still letting the PR campaigns in but then remove those revealing the flaws. which although makes the topic magically positive and happy, isnt really helping reveal the truths.
but yea maybe those that have never used LN should take the advice and not promote/exaggerate it/comment on it until they have used it

That doesn't answer my questions. Are you telling everyone in the forum that the developers from Lightning Labs, the creators of the Lightning Network, are scamming everyone?


I am, and I have asked someone from Bitrefill about your posts. He said that you're nothing but a fudster.

Going back to the question, are you telling everyone that the developers of the Lightning Network are scammers?

I think b, but can't be entirely sure.

LN worked fine, the payment was sent and not returned.

I used Eclair (Android), which works fine. The only thing difficult is when I want to receive a payment on my phone, and have to transfer the request to my PC. I did that by email because I couldn't use a QR-code.
Working with only one device would solve that, but it's very easy to send funds the other way (from Eclair to a website on my PC). This won't be any different when using Bitcoin, but I don't usually try to receive Bitcoin from a website on my PC to my phone.

For 100 satoshi: nobody :)
For larger amounts: the third you're dealing with. Basically the same as any other Bitcoin payment.
If you mess up and lose your funds, you're on your own.

Disregard the guys fighting they are trying to work out a few kinks! Please notice LoyceV that LN Is still like pre-Beta lots of bugs and majority of the site operators are using opennode.co's service Only a few are built from scratch with minimal scrapers ex (Microlancer.io)
LN seems to have lost a lot of traction in the last month, However Ive raised some BTC to sponsor a LN Awareness campaign sponsored by at least 12 LN site operators, (since these are micro BTC platforms Ive convinced site owners to run a LN awareness campaign to advertise the current LN Eco-Sphere)
Adoptions going to be a little slow during rally's , but when fee's are 15k sats consistently LN will be brought to light .


And I agree OP should come here and lighten the mood!

Just wanted to write something about the word "IOU" that seems to be a symbol for what's good or bad in LN ;)

IOUs in the Bitcoin world have a bad reputation basically because of exchange defaults like MtGox's insolvency. Of course, you can call a HTLC an "IOU". But the type of IOU exchanges offer to you are extremely different from these offered by LN.

The difference is actually in the way disputes are resolved. A conflict with a centralized exchange about an IOU can only be solved with human intervention, in severe cases the the judiciary system must be involved and the conflict may not be solved at all. In LN, however, you have a totally automated, not compromittable (if not destinating very large funds to double spend via 51% attack) and very predictable dispute solving instance - the Bitcoin blockchain.

Imagine an exchange offering you the same type of security for their IOUs. I, for myself, would use them ;)

LN Bitcoins ("msats") are not equal to blockchain-Bitcoins, but they are backed by Blockchain BTC in a much more reliable way than all centralized wallet providers, exchanges, etc. can provide. And most (if not all) Bitcoin users still use these centralized providers, so why shouldn't they use LN if it's even better?

stop with your social drama(you used the words lightning labs are scammers. not me)

LN is simply not secure it wont be secure even the devs admit it has flaws. devs admit it not due to them being "scammers" but just due to how the network functions.
(2 parties can privately agree on any rules/collateral they like because there is no community wide audit to force compliance)
(Msats are not tethered by network protocol to only represent bitcoin. Msats just tally an iou value for later settlement)


if a network could transport value securely without a blockchain. then decentralised e-currency would have been a thing before satoshi invented bitcoin/blockchain

thre is a reason blockchains were needed.
 in short YOU are saying they are all scammers
i am saying LN wont be what everyone hopes. and most definitely wont make YOU rich
scammers can find many flaws to abuse, so its worth highlighting the flaws. even devs agree to highlight the flaws.
my opinion on devs, a good amount of them are more interested in making a network to make their VC investors get some returns by deburdening the bitcoin network(mainly the ones that love the idea of huge btc fee's, small blocks and where they call LN a layer which solves adoption)

Meandering. 8)

No, I was asking YOU if you believe they are scammers. Because as far as I know, they will never tell anyone that Lightning has IOU pegged promises to pay tokens. I never said it either, but you did.

Are the Lightning developers not telling everyone the real facts about Lightning?


But there are no IOUs in Lightning. They are actual signed transactions by the participants of the channel that have not been broadcasted in the network yet.

I know. But as long as they're not broadcast (in the majority of the cases, they will never be broadcast) these transactions "exist" between the participants of the transaction only (which are not only sender and receiver, but also the intermediate nodes who transmitted them). So while they're not typical IOUs (like tokens or exchange balances, for example) they have some properties of IOUs, as they show the "balance" between the participants of the channels which is independent of the current state of the blockchain (only that it cannot be higher in favour of one of the participants than the channel capacity).

But the Bitcoin blockchain acts as an arbiter. So the risk associated to them isn't comparable with "standard IOUs", but much closer to standard Bitcoin transactions.

In reality, I wouldn't describe them as IOUs but as a "new type of thing", although they share some properties with IOUs, and others not.

But if everyone moved to Lightning Network, how would the bitcoin network work. If less transaction in the pool, work would be less and miners would go out of business. If all miners left bitcoin, would the Lightning network still work? Does Lightning has any plan how to keep Bitcoin surviving?
PS - I loved Lightning network and it's the future of bitcoin

LN piggy backs BTC blockchain,(layer 2 protocol) It wouldnt ever settle channels "if" this where to happen. But not to worry it wont happen LN runs off Node's and does not mine so noone would be directing hashpower to LN as thats not how it functions. Think of LN to BTC as what TCIP is to the internet.

First, there are significant block rewards for some years to come, still.

Second, even Lightning needs on-chain transactions sometimes, for example to open channels. If millions of people wanted to open channels, some of them would have to wait because if we assume that we can open 1000 channels per block, that would be 144000 channels per day. That's less than newborn childs per day (~300-400K), so we can assume that in the case of a massive Bitcoin adoption blocks will be relatively full even if everybody uses LN and not a single "settlement" would be necessary. "Settlements" could make up for a significant transaction quantity, too. (Channel factories can reduce the blockchain bloat, however, but that's actually positive).

But what happens if Bitcoin lacks massive adoption but most people use LN? Well, there is nothing to fear either. There will be a balance between Lightning transactions and non-Lightning transactions. On-chain transactions have some decisive advantages over Lightning transactions, because they are totally trustless and independent from if the receiver is online or not. Thus, there will always be a demand for on-chain transactions if they are not too expensive, for example for important amounts of money (which would exceed most channels' capacity and provide more security), but also for example for OP_RETURN transactions (e.g. token transactions like Tether or data entries). And if blocks are not full, then on-chain TX will be relatively cheap, so this demand would prevail.

Fees will almost certainly be lower than without LN, but I think they won't be lower than they were in most of 2018, for example.

Hello I heard that with the Lightning Network you have to be online all the time to get payment.  What happens if I'm offline will the sender even be able to send?  Since it has to be online all the time can I run a full node on my phone which is pretty much on all the time? 

Hey.
I didn’t read the full topic, so I’m sorry if my question is still answered.

Can someone explain me what’s up with these zombie nodes?
I run a node since 3 months, and haven’t change anything now since 2 weeks.
What dose that means to the node?

What can I do ?

Greetings

Nothing. Zombie nodes issue was fixed a long time ago. Your node is fully operational if it is connected to the Internet and up-to-date with the Bitcoin blockchain. You don't have to change anything in your node's settings. Zombie node referred to a node which was offline and still had been considered capable of routing payments.


The payment will fail after some time if not immediately. Running a node on your phone would quickly drain your battery.

Also if you're running an SPV node? I think (hope) SPV Nodes could help users to have their own node without having any knowledge about servers and just with their phones.

Haha, don't give an inch to their narrative. I wouldn't give the fudsters any encouragement by saying "they share some properties with IOUs". Because you're not sending anything worthless - IOUs in Lightning.


https://twitter.com/electrumwallet/status/1134132601046937601?s=21

8)

If a discussion should have any value and not be only a game of propaganda and counter-propaganda, one should not try to hide disadvantages and tradeoffs. The main property that LN channel balances are sharing with IOUs is obviously that it is possible that one party runs away with the money of the other one (if the other isn't watching his/her channel and settling), because of a disagreement about "how much one owes to the other".

But that isn't of much relevance, because if you're watching your channels regularly, in the case this conflict happens, you can always call an extremely reliable arbitrator (the Bitcoin blockchain).

So what I'm saying basically is that "even if LN shares properties with IOUs, that is no point for FUDsters." So the complete argumentation of these people falls to pieces. :D

Irrelevant. But that property also shares it with real Bitcoins sent to a special multi-sig wallet, that was confirmed on-chain, to fund the channel.

I see our opinions on this topic are not too far away one from another ;D

But ...
... what is the difference between the scenario you describe and LN? The disagreement I wrote about isn't about the BTC  "parked" in the transaction, but about the channel state (the transactions that are never broadcasted). Dunno what you mean here.

windfury. can i just give you some advice
try not to get involved in LN discussions until you understand it and atleast used it.

for pages AND topics now you have shown lack of experience of using it and also lack of awareness of its function, and lack of research of how it works/how its coded.

i understand you want to promote it, but please just spend some time understanding what your promoting and stop trying to be a snake oil salesmen for something you dont fully know.

trying to be the utopian positive salesmen is unhelpful, especially an inexperienced salesman who's making it obvious you not only dont know, but dont wish to know.
so if you do want to positively promote LN IN THE DISTANT FUTURE atleast spend some time now actually learning, researching and experiencing it

its getting ridiculous that you spend pages saying 'there is no iou or pegs' but you have never proved your point nor shown any desire to prove it. you just want to rubber stamp your repetitive misunderstanding, which is becoming more suspect of doing so just to 'post count' some signature/footnote campaign income

anyway. the whole point of bitcoin is once confirmed the payment is done, irreversible, fully secure, no counterparty needed, no trust. its just done,

any stuff before a confirm is just blah. insecure untrusted not guaranteed, not complete, irrelevant

LN is IOU, reversible, insecure, requires others permission, no guarantee you get to keep what was suggested to be owed to you.

LN payments are not bitcoin payments from the point of view of:
actually owning the funds complete and in the clear(irreversible)
unit of account, LN=msats bitcoin=sats
bitcoins are push payments 24/7. LN are agreements when others are available
LN units of account are not even protocol locked tethered to bitcoin
LN units of account are not even forced to be collateral of confirmed bitcoin(turbo zero confirm)
LN units of account are not even recognised on the bitcoin network

LN is not a feature solely and exclusively for bitcoin. it is not a 'layer' it is a separate network

None of that changes if people use the Lightning Network. I don't really get why you're so against it. Who cares if people use something they like?

I've seen this argument before, and I don't know how LN handles the rounding on settlement, but honestly I couldn't care less about possibly losing 0.999 milli-satoshi.

I've played with it, and I like it! I know it's immature, experimental or even high risk to use, but considering the possibilities, I'm totally fine with risking a few bucks on it.

I will stop to get involved in Lightning discussions, if you stop with your misinformation rampage about the Lightning Network. Plus for the benefit of the people discussing in the topic, do you, or anyone else believe this person is correct in his opinion of the Lightning Network?

https://twitter.com/rogerkver/status/1135567225102905345

Even if that would be true, I'd be totally fine with a trusted system for small Bitcoin payments. Exchanges are trusted with billions worth of crypto, I'd love to see them develop a standard to make small, low-fee transactions to other users.

Hello,

may I ask you for some logical question about Lightning Network?

I use the channel explanation on this site:
https://bitcoinmagazine.com/articles/understanding-the-lightning-network-part-creating-the-network-1465326903/ (https://bitcoinmagazine.com/articles/understanding-the-lightning-network-part-creating-the-network-1465326903/)

Main question: But this seems that middlemen Bob has to broadcast the transaction which gives to him the money on chain if he provides the value otherwise the CLTV on the third output option of commitment transaction ensures that after a certain time Alice receives the bitcoin and cancels all this. That can't be understand well, because this means far more than only maximum two on-chain transactions per channel.

Q2: How is ensured the autenticity of inner communication in the LN? It seems like all data pushed through the channel must be signed to be verify by the counterparty.

Q3: How the nodes start multihub transfer? How can be Alice sure that the pre-image which she obtained is really from Carol (in LN example scheme)?

Q4: What is the main difference between CLTV and CLV timelocks?

Q5: Do Channel Factories make sense in the future or it's only another optimalization resolve?

Q6: Please, specify, where exactly the Lightning layer is (internet, blockchain etc.) and how exactly the nodes communicate (and in which layer, too).

Q7: Do you think that understanding LN is much harder than understanding Bitcoin?

That's the spirit! https://discord.gg/YCqQZqq <-LN Discord, Full of devs if you have any problems its pretty much so an LN ecosphere.

not misinformation, just not positive unicorn rainbow dreams and empty promises of LN PR

now your derailing into social drama. funny how you go full on time waste to try to drag in the bitcoin cash derailments but dont spend time learning LN

but anyways. the whole "what is a custodian" is the main point
custodians do not have to be the single owner/holder/manager.
they can just be a key holder with partial responsibility to maintain something.

look at schools, residential buildings, even police evidence.
a custodian does not need to fully own(building lease/school head) they can be the janitor or officer handed keys and given some privelidges/authority of what they are allowed to handle.

so yes LN is custodial as its counter party. you and another party are custodians
(i know you previously tried to think custodians had to be a centralised powerhouse institution. but thats not the case)

To get back on topic, I'll share more of my own experience for the FAQ.

First, Eclair syncs very fast since yesterday's update! The sync time was annoying earlier, so I like it.

What happens if a funding transaction doesn't confirm in time?
I opened a channel with a low fee, which didn't confirm within a day. This is the current state:

• Status: "CLOSING (uncooperative)"
• Closing type: "LOCAL (initiated by your node)"
  
• Cause of closing: "sync error"
• "Refund in 58 blocks"

Until now, it wasn't clear to me how this would work, and it's still unclear to me how the transaction fee is determined.
The closing fee (0.2+ mBTC) was high enough to almost instantly confirm my funding fee (CPFP).
This fee moved my funds from one Bech32 address to another, and I assume it will move to my own address once it closes. That means another fee, which makes it close to 20% of the total channel balance. At this moment it costs me just over $3 to close the channel (even though I haven't been able to use it at all). Bitcoin fees have been more than 10 times higher than they are now, which would put the total fee to just close a channel around 5 mBTC ($100 when Bitcoin was at it's peak).
Channels with a low balance (the minimum is 1 mBTC) won't even hold enough funds to pay a high fee. That means the channel can't be closed, and whoever has funds in them more or less loses them.

Those high fees will be a serious limitation even for a second layer channel. Instead of closing a channel, it now becomes much more interesting to send the entire balance to a LN-service in exchange for an altcoin. But I'm not sure if that's possible, until now the channel doesn't allow me to send my full balance. It varies a bit, so I'm not sure what the minimum reserve is.

Another disappointment is that I have to wait for the channel to close. If there have been no transactions at all on the channel, I'd like to see it instantly returned to my own wallet. Or even better: if the funding transaction doens't get confirmed, it would be much better to just let it drop out off mempool and never open the channel.
I'm now at the rediculous situation that my transaction was only confirmed because the closing transaction paid for it through CPFP.

Thank you for your report. I fully agree, the fees are one of the main limitations of LN.

In the current situation, however, it would be enough if a higher percentage of all low-value transactions moved to LN. I've just looked ad Bitinfocharts: the median transaction value is currently at 0.053 BTC (https://bitinfocharts.com/comparison/bitcoin-mediantransactionvalue.html) ($406.46 USD). If only half of the transactions with a lower value (roughly, these lower than 100 USD, I guess) could move to LN then we would have much less congestion and much lower fees - basically, we would have the same fee level at weekdays that we now have at weekends. Then you could open and close channels for less than 1 USD.

The problem is that even a growth in 25% of transaction blockchain space usage (in kB) or "adoption" in other words would bring us again to current fee levels of single-digit dollar values.

Channel factories could surely help, but I think they'll be not enough.  That's also why I'm also interested in side-chain and pegged-chain technologies. Those could complement LN and make really massive scaling possible.

Yes they are. Read your posts.


Stop meandering, and making confusing posts that doesn't answer anything. You're not helping the topic. I want an explanation why everyone on Twitter replied that Roger Ver is wrong. Do you agree with "they are using non-wallets similar to Paypal", or not? Why?

The funds were indeed sent to my own address with a very high fee per byte (total 0.18 mBTC, slightly lower than the previous fee). After this, I consolidated my funds with a 50 times lower fee, and this took 100 minutes to confirm. I can't help but feel like LN is wasting a rediculous amount on fees. I assume it's set by the node, but I'm not sure what it's based on.

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Eclair doesn't allow coin control. Instead, it uses all available inputs (including dust) and consolidates them. That also leads to higher fees than needed. You can reduce the total fees by consolidating (https://bitcointalk.org/index.php?topic=2848987.0) inputs with a low fee before funding a channel.

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I'm funding another channel now, with a bit higher fee this time (currently 9 times more than what Bitcoin Core thinks is needed to confirm within 2 hours).

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https://1ml.com gives an extensive overview of LN nodes, including an overview of the base fees. I'm not sure what everthing means though, there's a lot to take in for new LN users.
I'm now bookmarking the nodes on my laptop, so I can find them back on Android.

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What I really like about LN, is that many inputs no longer lead to a higher fee. "Bitcoin dust" isn't a problem anymore as long as it's within LN.
LN doesn't allow to send a payment without making a payment request, but I read this might be included in a future upgrade. I can imagine this will be great for advertising: send a fraction of a satoshi to all channels you can find, and add a message. Without some sort of spam protection this might become a problem in the future.

Hey LoyceV , as far as swapping to alts there's zigzag.io  Dash,LTC and ETH are on the list
Fee's are high though.

I heard submarineswaps is doing LTC I have not used it yet though

I haven't tried zigzag yet. I did try coinplaza.it, which has surprisingly low fees for a small transaction (even to onchain Bitcoin).
There's also fixedfloat.com, which I haven't tried yet.

I don't worry about this for the following reasons:
Bitcoin fees spiraled up because users have no choice. Miners only compete against each other for blocks, but that doesn't increase block space.
In LN, there will be many different routes, and hub owners compete against each other on fees. If fees are high and hub owners make large profits, new actors will join the hub-market until fees are lower again.
More transactions obviously increase hardware requirements, but more transactions also means there are more fees to be earned. At the moment I don't think hub owners make a profit from the few small fees. They actually need much more transactions to earn money. If there would be a million times more transactions, I don't think the hardware cost per transaction will be very high.

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Update on my little experiment: now that I have a second channel, a 5 sat transaction takes only 5 msat fee, instead of 1 sat. That makes sense, as the other channel has a lower fee.
However, a 100 sat transaction now takes over 3 sat fee! It uses the new channel, while the other channel would have charged only 1 sat. So I guess routing still needs some work.
For small transactions, 3% is not a problem. However, if I would send (say) 0.1 BTC, I would like to see the fee upfront if it's going to be around 3%. I'm not sure if LN even supports that before completing the channel.

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Another update: Despite having 2.5 mBTC "Total can send", I can't send 2 mBTC ("Your Lightning channels do not have enough balance"). When I try to send 1 mBTC, I get: "Payment failed, Route not found". After trying a few times, Coinplaza banned my IP for a few minutes.
I've read before that "larger" payments often can't be routed, now I found out by myself :P

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I made several smaller payments to my account at tippin.me, which all worked. The total was >1 mBTC now. But: fees were just over 3%, which is the maximum Eclair allows (and the only thing about it in settings). I've recently made cheaper on-chain payments!
From tippin.me, I sent 101010.10 sat to coinplaza.it. This got me 1 mBTC on-chain to my Bitcoin address. And although 1 sat/byte (https://coinb.in/#fees) is enough, coinplaza.it paid 128 sat/byte, which is about 31 times more than the margin they had on this transaction.

I pay much less fee through tippin.me than through the last channel I opened in Eclair. I'll try opening a channel to tippin.me's node next time.

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After many transactions, Eclair doesn't show my full Payments history anymore. I can only see the last 5 days.
So far, I've lost less than 1 mBTC in total on fees. Not bad for a week and a half of LN-experimenting.

I think I picked a LN node without enough cheap connections.
I'm closing the "expensive" channel now, see how that works. It says "CLOSING  (cooperative"). It should be able to do this at very low fee. It looks like my 1.42 mBTC LN-balance turned into 1.32 mBTC on-chain. The total fee wasn't that high, but still 10-20 times higher than needed for a fast confirmation.

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Question
How do I choose which node to open a channel to?
And: I expected payments to use both channels when possible, but until now that hasn't happened.

love it. i can just imagine that conversation

bitcoin dev salaried by corporation:
     'bitcoin cant scale because you cant receive, validate and broadcast 3000 tx in 10 minutes'
bitcoin dev salaried by corporation:
     'LN is where wveryone should be because you cant recieve, validate and broadcast thousands/unlimited tx in seconds'
community:
     'why cant bitcoin?'
bitcoin dev salaried by corporation:
     'coz hardware'
community:(in sarcastic tone)
     'ohhh the same hardware LN needs to receive, validate, sign, revoke old sig and broadcast thousands tx in seconds'

There are externality costs. Increase the block size, and the costs are transferred, and subsidized somewhere else. It would also sever the network of full nodes, centralizing it futher. It's best to overshoot security in my opinion.

Plus it would set a bad precedent. The best example, Bitcoin Cash ABC and SV.


It's a theory at best, and I agree that the Lightning Network can fail, the same as Bitcoin as a software experiment can also fail, but why stop its development if it doesn't affect, or make contentious changes on the conensus layer?


Scared to be memefied? 8)


Shower thought. I believe if Lightning is used in a massive scale, its fees will be higher than most altcoins because routing hubs are staking a valuable asset in Bitcoin to maintain their channels.

towel thought:
when was the last time someone went to a bank with a bank note(promise/iou) and exited the bank with gold
when was the last time someone went to a bank with a bank note(promise/iou) and exited the bank with less precious metals

if you say the 1950's
in the 1950's
how many went to a bank with a bank note(promise/iou) and exited the bank with gold
how many went to a bank with a bank note(promise/iou) and exited the bank with less precious metals

the answer is more people deposited gold in but ended up taking silly small coins out

big mega hint:
LN is not a sole bitcoin feature of only bitcoin design and function
LN REQUIRED bitcoin to change to give bitcoin an access method to use LN
LN is a separate network
LN is a network of independant/guaranteed payment. but a network of requiring users to be funded to join, online to be paid and requires another entities authorisation just to attempt to get funds moved

As LoyceV suggested, I am closing this thread. I will create a self-moderated thread due to growing number of off-topic posts in this FAQ. Feel free to create separate threads if you want to argue.