The Lightning Network Reality Check

[BlindMayorBitcorn]

Do you ever feel like you are in a conversation with someone and they are not really telling you the whole truth?

http://codesuppository.blogspot.ca/2016/01/the-lightning-network-reality-check.html

There is one way that the Lightning Network numbers do work; and that is if individual people don't get to access the blockchain at all.  If the only ones opening and closing channels on the main blockchain are banks and wealthy individuals, everyone else can just operate on layer-2 or 3rd party networks 100% of the time.

[johnyj]

After all, the ability to do transaction on chain is only attractive for people with enough IT expertise. I guess the number of people in this user group will be maximum 10 million people around the world. Rest of the people would rather use centralized services due to the security risk and ease of use, old habit etc... There are just so many ways to lose your coin if you are not an IT veteran

[jonald_fyookball]

Love this bit:

There is one way that the Lightning Network numbers do work; and that is if individual people don't get to access the blockchain at all.  If the only ones opening and closing channels on the main blockchain are banks and wealthy individuals, everyone else can just operate on layer-2 or 3rd party networks 100% of the time.  Such a scenario can and will work.  However, those layer-2 networks will be subject to all of the rules and regulations that most true bitcoin believers are trying to avoid.

If you think smaller blocks will make a more decentralized bitcoin, read this article because you may change your mind.

[SebastianJu]

I think the reality will simply be that not many users will switch to ln. Why should they? It took enourmous work for altcoin provider to attract a couple of users. It will not be very different for ln.

And bitcoin itself will have problems more and more with the transactions. Bitcoiners will get angry and will search for an alternative. The nearest solution will be a bitcoin solution so they will chose a bitcoin client that will promise to solve the issue. Problem solved, bitcoiners can proceed how they know it from the past. No big learning curve.

Well i hope that such an alternative comes out soon since the problems of not freeing the protocol from it's artificial restriction will get out of hand soon.

[franky1]

lightning network was suppose to be a bit of relief where people had free decision which way to transact.

this would be done by people deciding to want instant transactions one day, so they deposit funds into a LN locked transaction. and then separately they can transact instantly with certain merchants in that channel

the resulting blockchain would look like this:



but now it seems that instead of allowing freedom of choice between normal bitcoin transactions and instant offchain transactions.. it seems they want to push all users offchain and only have selective merchants using the real blockchain to make settlements.

this may explain why blockstream is trying to cut people off from making their own implementations as i beleive oneday they will charge people subscriptions to use bitcoin-core.. at a fee only merchants would pay

[Lauda]

The only thing that this article really states is that lightning does not scale infinitely.

hash locked bidirectional payment channels (aka lightning) fundamentally change the limitation from transactions per second (ie bytes/second) to channels open/closed per second (i.e. active users).

but now it seems that instead of allowing freedom of choice between normal bitcoin transactions and instant offchain transactions.. it seems they want to push all users offchain and only have selective merchants using the real blockchain to make settlements.

It seems to me that people are in the delusion that somehow Lightning is not Bitcoin. There is nothing wrong with transacting off-chain, especially when the security is almost identical.

The nearest solution will be a bitcoin solution so they will chose a bitcoin client that will promise to solve the issue.

The closest thing to a solution (that we currently have/will have) is not XT, nor BU, nor Classic but the Lightning Network.

I think the reality will simply be that not many users will switch to ln. Why should they? It took enourmous work for altcoin provider to attract a couple of users. It will not be very different for ln.

Are you seriously comparing it to an altcoin?

i think that's completely unwarranted; it's the same currency, and the same transactions even; they just don't instantly hit the blockchain (but are secure nonetheless)

[BlindMayorBitcorn]

The only thing that this article really states is that lightning does not scale infinitely.

Here's what I took away from it: the bitcoin network itself will have to grow substantially in size to accommodate more users and to remain uncongested.

Meanwhile, there is a strong effort to heavily constrain the bitcoin network today.

...

The fact of the matter is that if you limit the bitcoin network to only 1mb in size it will naturally evolve from just a few hundred thousands geeks from using it to only banks and the wealthy to be able to access it.

[SebastianJu]

The only thing that this article really states is that lightning does not scale infinitely.

hash locked bidirectional payment channels (aka lightning) fundamentally change the limitation from transactions per second (ie bytes/second) to channels open/closed per second (i.e. active users).

but now it seems that instead of allowing freedom of choice between normal bitcoin transactions and instant offchain transactions.. it seems they want to push all users offchain and only have selective merchants using the real blockchain to make settlements.

It seems to me that people are in the delusion that somehow Lightning is not Bitcoin. There is nothing wrong with transacting off-chain, especially when the security is almost identical.

Well i guess people always will get cautious when people in power decide to not fix something and instead try to force an alternative solutions on the people. I think it's pretty normal to react that way since such a behaviour normally means that something fishy is coming with it. That has not to be the fact but the reaction on such actions are still he same.

The nearest solution will be a bitcoin solution so they will chose a bitcoin client that will promise to solve the issue.

The closest thing to a solution (that we currently have/will have) is not XT, nor BU, nor Classic but the Lightning Network.

Well, this is the bitcoin community and bitcoiners normally share the vision of bitcoin becoming a worldwide currency. Now some people in power clam we have to leave bitcoin in order to use their system and deny the way to fix the real bitcoin. The reaction is awaitable for sure.

I think the reality will simply be that not many users will switch to ln. Why should they? It took enourmous work for altcoin provider to attract a couple of users. It will not be very different for ln.

Are you seriously comparing it to an altcoin?

No. I only compare the work that has to be done to make people use the alternative payment network to the same work that has to be done to use an altcoin.

I mean you have to buy altcoins to pay with them. It's an investment. The same way you have to buy into payment channels and bind your bitcoins in the system without being able to freely move them. That's the first hurdle to overcome when it comes to convince people of using it. In fact i think it will be pretty much impossible to move a considerable amount of people to move to ln.

i think that's completely unwarranted; it's the same currency, and the same transactions even; they just don't instantly hit the blockchain (but are secure nonetheless)

Well, you can say that changetip is bitcoin too then. The bitcoins only are transferred offchain. And you don't see a difference why you would not trust changetip with your monthly earnings? Yes, ln is safer but still there is a group who demands you, no tries to force you to use their new system. They don't take out the artificial restriction that hinders the bitcoin network and present their own network as solution.

Guess coming from the inside doesn't make it look fishy. But i can ensure you, it looks fishy to normal bitcoiners. I see that ln has it's place in the game but i think it's place is way way more limited than the ln-fans want to believe.

[SebastianJu]

The fact of the matter is that if you limit the bitcoin network to only 1mb in size it will naturally evolve from just a few hundred thousands geeks from using it to only banks and the wealthy to be able to access it.

Didn't you get the news that this is what bitcoin should be about? A high payment network only. It was never meant as a replacement for fiat money in general. We, who want bitcoin to be useable for all are only anarchists and socialists while the elite, who knows what bitcoin was meant for in reality are the real libertarians. They are the real bitcoiners from the beginning of bitcoin and we are socialists who try to take over bitcoin now. Let's forget about satoshies wish to free the people of the power of banks. Bitcoin is to empower the rich and the banks. How could we not see his vision clearly. I feel dumb now.

(I have read things like that from 1mb block fans.)

[Carlton Banks]

i think that's completely unwarranted; it's the same currency, and the same transactions even; they just don't instantly hit the blockchain (but are secure nonetheless)

Well, you can say that changetip is bitcoin too then. The bitcoins only are transferred offchain. And you don't see a difference why you would not trust changetip with your monthly earnings? Yes, ln is safer but still there is a group who demands you, no tries to force you to use their new system. They don't take out the artificial restriction that hinders the bitcoin network and present their own network as solution.

You clearly don't get it:

Changetip own the private key with "your" money:  not Bitcoin

Lightning Network doesn't hold your private key, you hold it: Bitcoin

Understand?

[Lauda]

Well i guess people always will get cautious when people in power decide to not fix something and instead try to force an alternative solutions on the people. I think it's pretty normal to react that way since such a behaviour normally means that something fishy is coming with it. That has not to be the fact but the reaction on such actions are still he same

Bitcoin does not scale well without a better infrastructure. Anyone with a proper IT background should know this by now. Who are you to decide what a 'primary' solution (in your case, block size) and what an 'alternative' solution is? There is nothing fishy coming with LN. The only 'fishy stuff' that could come, comes due to the delusion of knowledge and understanding of LN.

Well, this is the bitcoin community and bitcoiners normally share the vision of bitcoin becoming a worldwide currency. Now some people in power clam we have to leave bitcoin in order to use their system and deny the way to fix the real bitcoin. The reaction is awaitable for sure.

There is nobody 'in power'. The 'forkers' tend to use open source and multiple implementation as argument. Due to Bitcoin being trustless, open source and based on consensus there can be nobody 'in power'. They are just people that have stated how they feel about it. I might leave Bitcoin as well if a political fork becomes a reality.

The same way you have to buy into payment channels and bind your bitcoins in the system without being able to freely move them. That's the first hurdle to overcome when it comes to convince people of using it. In fact i think it will be pretty much impossible to move a considerable amount of people to move to ln.

'Buy into payment channels'?

Well, you can say that changetip is bitcoin too then. The bitcoins only are transferred offchain. And you don't see a difference why you would not trust changetip with your monthly earnings? Yes, ln is safer but still there is a group who demands you, no tries to force you to use their new system. They don't take out the artificial restriction that hinders the bitcoin network and present their own network as solution.

Changetip is very much Bitcoin (the currency). LN is similar to changetip, except that LN is not a single party that can run away with your money, or go bankrupt, or hold your coins hostage. After a certain time period you get your funds back.

maaku> And for the 2nd, changetip is custodian. Payment channel networks don't involve giving your coins to some 3rd party. Plus they come with cryptographic proofs and auditability, etc.

You clearly don't get it:

Changetip own the private key with "your" money:  not Bitcoin
Lightning Network doesn't hold your private key, you hold it: Bitcoin

Well, that's is one way of looking at it (still better than his). Apparently people think 'off-chain' implies 'not direct in relation to mainchain/Bitcoin'.

[franky1]

Bitcoin does not scale well without a better infrastructure. Anyone with a proper IT background should know this by now.

werent you strongly defending segwit recently. trying to kick 2mb limit increases to the curb by saying that there was not a scaling problem? and that segwit was more a utility to solve double spends and allow other features rather than scaling....., and trying to alleviate people of their worries of a scaling problem that a simple block increase would solve..

seriously. i know you have not done the research. but its time you do. learn a bit more and realise the real situation. and stop playing into the arms of the programmers who think they are gods

[Lauda]

seriously. i know you have not done the research. but its time you do. learn a bit more and realise the real situation. and stop playing into the arms of the programmers who think they are gods

Who said that I was not a programmer as well? Unlike the majority here, I can understand the written code.

werent you strongly defending segwit recently. trying to kick 2mb limit increases to the curb by saying that there was not a scaling problem? and that segwit was more a utility to solve double spends and allow other features unrelating to scaling come about, and trying to eleviate people of their worries of a scaling problem that a simple block increase would solve..

This is off-topic here but I'm going to elaborate once again. The benefits of SegWit greatly outweigh the need (at this very moment) for increasing the block size. The features that come with it are of bigger importance (again, at this moment). SegWit is one of those improvements to the infrastructure that will help Bitcoin scale better (e.g. IBLT, weak blocks). My opinion stands though and is probably misinterpreted here. If there was no SegWit I'd support 2 MB. In the case of SegWit vs 2 MB blocks I definitely support SegWit more than that. Note: It is possible to construct a transaction that takes longer than 10 minutes to validate with 2 MB blocks.
Let's stick to LN in this thread shall we?

[Carlton Banks]

Bitcoin does not scale well without a better infrastructure. Anyone with a proper IT background should know this by now.

werent you strongly defending segwit recently. trying to kick 2mb limit increases to the curb by saying that there was not a scaling problem? and that segwit was more a utility to solve double spends and allow other features rather than scaling....., and trying to alleviate people of their worries of a scaling problem that a simple block increase would solve..

weren't you pretending you understood what SegWit does recently? Oh right you still are.

seriously.

No. Erase this word from your vocabulary, you cannot seriously expect anyone to respond to you in that way

[franky1]

seriously. i know you have not done the research. but its time you do. learn a bit more and realise the real situation. and stop playing into the arms of the programmers who think they are gods

Who said that I was not a programmer as well? Unlike the majority here, I can understand the written code.

werent you strongly defending segwit recently. trying to kick 2mb limit increases to the curb by saying that there was not a scaling problem? and that segwit was more a utility to solve double spends and allow other features unrelating to scaling come about, and trying to eleviate people of their worries of a scaling problem that a simple block increase would solve..

This is off-topic here but I'm going to elaborate once again. The benefits of SegWit greatly outweigh the need (at this very moment) for increasing the block size. The features that come with it are of bigger importance (again, at this moment). SegWit is one of those improvements to the infrastructure that will help Bitcoin scale better (e.g. IBLT, weak blocks).
Let's stick to LN in this thread shall we?

and a 2mb increase solves scalability while also.. guess what..
allowing segwit to have 1mb pruned blocks and 1.5mb full archival blocks that wont get thrown out if people only stuck to 1mb limit..

win win

your happy, im happy, both normal nodes and segwit nodes can work together.. (aslong as segwit sends full txdata+witness in standard block format by default, and allows pruned blocks as secondary option just for the segwit crew)

[BlindMayorBitcorn]

Off-topic: I understand that SegWit fixes transaction malleability, but appears to some to have been added to the scaling roadmap as a political move.

[BlindMayorBitcorn]

On-topic: it seems political, too, because LN will need huge signatures?

[Carlton Banks]

Off-topic: I understand that SegWit fixes transaction malleability, but appears to some to have been added to the scaling roadmap as a political move.

Nope, segregated witness segregates the signature chain from the transaction chain. And increasing the overall blocksize as a side-effect. Malleability fix is also a side effect.

[Carlton Banks]

On-topic: it seems political, too, because LN will need huge signatures?

SegWit and LN go together: SegWit reduces the on-chain size of huge multi-sig tx's. Lightning makes use of that nicely.

Nothing political about it, other than offering unidentified political reasons to dislike it? You post alot but it often sounds confused on the technical issues.

[BlindMayorBitcorn]

I take it upon myself to ask the dumb questions everyone else seems to already know the answer to. It's a burden sometimes.
Clearly you should post more.