[OUTDATED] The Lightning Network FAQ

[franky1]

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 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.

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

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.

[1714823449]

1714823449

[1714823449]

1714823449

[1714823449]

1714823449

[1714823449]

1714823449

[Wind_FURY]

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?

[franky1]

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

[Wind_FURY]

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)

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.

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

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

[DooMAD]

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

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?  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.

[franky1]

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

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)

[Wind_FURY]

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

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?

[franky1]

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

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.

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

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"

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

const mSatScale uint64 = 1000

// MilliSatoshi are the native unit of the Lightning Network. A milli-satoshi
// is simply 1/1000th of a satoshi. There are 1000 milli-satoshis in a single
// satoshi. Within the network, all HTLC payments are denominated in
// milli-satoshis. As milli-satoshis aren't deliverable on the native
// blockchain

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?

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..

[Wind_FURY]

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

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.

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

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"

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

const mSatScale uint64 = 1000

// MilliSatoshi are the native unit of the Lightning Network. A milli-satoshi
// is simply 1/1000th of a satoshi. There are 1000 milli-satoshis in a single
// satoshi. Within the network, all HTLC payments are denominated in
// milli-satoshis. As milli-satoshis aren't deliverable on the native
// blockchain

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

Moving on.

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?

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..

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?

[franky1]

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

const mSatScale uint64 = 1000

// MilliSatoshi are the native unit of the Lightning Network. A milli-satoshi
// is simply 1/1000th of a satoshi. There are 1000 milli-satoshis in a single
// satoshi. Within the network, all HTLC payments are denominated in
// milli-satoshis. As milli-satoshis aren't deliverable on the native
// blockchain

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

Moving on.

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

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?

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

[Wind_FURY]

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

const mSatScale uint64 = 1000

// MilliSatoshi are the native unit of the Lightning Network. A milli-satoshi
// is simply 1/1000th of a satoshi. There are 1000 milli-satoshis in a single
// satoshi. Within the network, all HTLC payments are denominated in
// milli-satoshis. As milli-satoshis aren't deliverable on the native
// blockchain

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

Moving on.

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

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.

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?

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

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?

[CryptInvest]

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.

[Carlton Banks]

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.

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

It is also not understand for the continued support of the node, if the LN network commissions tend to 0.

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

[franky1]

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.

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)

[Wind_FURY]

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.

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.

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

It is also not understand for the continued support of the node, if the LN network commissions tend to 0.

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

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.

[franky1]

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

[Carlton Banks]

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.

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

[Wind_FURY]

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.  

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

hint. opening channels of pegged token that dont even have an equivlent onchain confirmed funding

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.

[franky1]

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

[d5000]

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

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.