Lightning network compared to Dash and IOTA

[asbator]

Hi guys!

there is a lot of hype about Lightning Network starting on Litecoin. Opinions are that it will make every coin using it rule, make them prepared for mainstream usage, bring their price to the moon, kill other coins and so on...

At the same time Dash followers on Reddit point out that Lightning network will freeze our balance and make Litecoin, Bitcoin unspendable, quite opposite to what is expected.
Same thing is described in this comprehensive explanation:
https://bitcoinmagazine.com/articles/understanding-the-lightning-network-part-creating-the-network-1465326903/

There is also interview with IOTA founder David Sønstebø, who calls all other coins (Bitcoin included) f...ing trash, which will all die, because IOTA tangle is the only right way to go with cryptocurrency (no mining, no fees and so on...).

For me all those opinions are obviously very biased, as all have their own interest in it. "Mainstream" users wants Lightning to be great, Dash followers believes in Dash, IOTA creator wants his baby to win.

My question is - is Lightning Network really going to lock our funds for so long time that its going to cause problems?
Cause it seems to me obvious that hackers could fail transactions for purpose and block the network.
(Would like to see some discussion based on reason, not on believes or faith in one coin or the other.)

[aleksej996]

It makes no sense to assume that. Any attack on Bitcoin is costly and with LN it should be even more costly.

[asbator]

It makes no sense to assume that. Any attack on Bitcoin is costly and with LN it should be even more costly.

Thx for reply. Could you explain more?

[aleksej996]

It makes no sense to assume that. Any attack on Bitcoin is costly and with LN it should be even more costly.

Thx for reply. Could you explain more?

I would say that these accusations need more explanation, since there is no way you can really make a reasonable conclusion that your coins will be frozen when LN activates.

In the article they explain how LN works and as you can see with those multisigs, the funds can be locked for a certain amount of time, whichever you wish that time it is. Two weeks is the biggest example in that article. And in those two weeks those funds are locked because they are being used in a LN, where you can spend them on anybody that is inside it. It is really no issue at all, it is a choice on how you want to use it and if you want to use it in the first place. After all, you can just keep using Bitcoin as you were before.

[pebwindkraft]

Maybe I am missing something in this logic, but yet it is just an opinion, and no proof:

In this “naive” scenario, middleman Bob still has to trust Alice and Carol. Bob has to trust Carol to really give him the value after he sent her a bitcoin, and Bob has to trust Alice to really give him a bitcoin once he presents her the value.
The bitcoin-for-value trades must therefore be absolutely guaranteed along the network. More specifically: if Bob gives a bitcoin to Carol, he must be guaranteed to get a bitcoin back from Alice.
That's where Hash Time-Locked Contracts (HTLCs) come in.

For sure, when it is money, we trust a lot, in Bitcoin world we trust the mathematical rules, not a person. Not sure what the author means by "Bob has to trust Carol". The author should explain, what happens, when Carol plays wrong, and what are the lightning protections to prevent this. IMHO, this has nothing to do with HTLCs. If Bob feels that Carol is not playing honestly, he can close the channel immedeatly... before the HTLC time locks in. Also the author doesn't explain, why multisig addresses are "funky". The multisig addresses can be seen as simple checks, where two or more people must sign, to validate it - what is funky about this?

Can't make up my mind yet, having difficulties to follow the logic in this article. 
I hope some more enlighted people will explain 

[aleksej996]

Closing the channel means that the current state of the channel will be confirmed on the Bitcoin blockchian and therefor be finalized.
And if it is done only by one party, then that party will risk their BTC, since the other could beat them to it since they know the secret that gives the right hash.
That removes the trust needed that the other party will use any past state of the channel to try to close it on that, since they would take a big risk.

It does nothing for the trust needed to exchange a value with a certain hash between Carol and Bob for one bitcoin. Since if Bob closes the channel after he pays Carol one Bitcoin for the value and doesn't get it back, he will either close it at the channel's final state where Carol gets that one BTC or at a past state where he risks his coins like in a previous scenario. This is just a way to have exchange of a value with a certain hash for BTC on the LN and therefor a way to make transactions between people who haven't opened a channel with each other with all the benefits of LN, therefor you get a network effect of a LN.

I don't know about a funky part, it is author's choice of words, probably to describe that these multisigs are not standard multisigs locked only with private keys and not with all these other hash and time lock features.

[nicosey]

Nothing compared to Dash.   Dash insta-send is just a locking mechanism.

[achow101]

My question is - is Lightning Network really going to lock our funds for so long time that its going to cause problems?

No, it is not. When you "lock" your funds in a LN payment channel, you can still spend those coins, albeit only with the other party in the channel. However with LN, if that other party is connected to other people via payment channels, you can make payments to those other people and the people they are connected to and so on and so forth. So your funds aren't "locked"; you can still spend them and move coins to other people that have LN channels open. Furthermore you can choose to close a channel at any time that you want and be able to access your coins as soon as the channel closing transaction confirms. There is no set time limit on a channel and there is no minimum time required for a channel to be opened.

Cause it seems to me obvious that hackers could fail transactions for purpose and block the network.

What do you mean by "fail transactions"?


The lightning network is different from DASH and IOTA in that it itself is Bitcoin, not an altcoin. With LN, you are moving and using Bitcoin so the value you move is fixed and does not change. If you were to use an altcoin in the same manner, you would risk losing money as the altcoin's value compared to Bitcoin's changes. Furthermore, many of the security risks and potential attack vectors are fairly well known because LN uses Bitcoin and Bitcoin's security risks and potential attack vectors are well known. With an altcoin that uses some crazy cryptography that may not necessarily be secure (IOTA had some broken cryptography which were pointed out in a security review done by 3 MIT DCI researchers) does not have known security risks and potential attack vectors.

[d5000]

The lightning network is different from DASH and IOTA in that it itself is Bitcoin, not an altcoin.

I think here he's referring to the native "instant send" mechanisms of Dash and Iota.

I prefer LN over both altcoin approaches (although I see it viable only for relatively small payments). Dash's instant send mechanism involve a degree of centralization ("consensus" in a very small sub-group of nodes [masternodes]) I don't support - LN at least has the option to be relatively decentralized, although we will see how the network topology will evolve. Iota still has not proven that it can work without the central "Coordinator" node and so should considered, for now, an experiment and not a mature cryptocurrency.