Electrum Lightning Network walkthrough

[Rath_]

Correct me if I'm wrong but in order to spend from that address, two signatures are needed. One mine and one node's. That's why it is larger than the others. (?)

Correct.

How can Charlie join this? Does he need to open his own channel? Or join mine? From my second wallet I generate a lightning address and I paste it on my first's "Pay to". Once I do, it probably decodes it to its HTLC form (256-bit in hex). [...] And that's reasonable. They probably have to connect somehow with "Bob" or in this case "STRANGESET".

You cannot join an existing channel. Right now, payment channels are established only between two people (channel factories are kind of close to what you mentioned, but they are not a thing yet). "Charlie" needs to open a channel to either the same node or any other node that is connected to your node through other channels.

Note that you won't be able to receive any funds through that channel unless you spend some coins (both parties need to maintain a channel reserve which is equal to about 1-3% of the channel's capacity, so a part of your initial payment will be used to fill other parties' reserve). If "Charlie" does not open a channel with the same node as you then his payment will need to be routed through other channels and it might fail due to lack of routes or enough liquidity in the intermediary channels.

[BlackHatCoiner]

"Charlie" needs to open a channel to either the same node or any other node that is connected to your node through other channels.

I connected "Charlie" with the same node "Alice" is connected. I broadcasted a transaction from "Charlie" to "STRANGESET" and waited for 3 confirmations. (Not sure why they've chosen 3)

I try to send funds to "Charlie" and returns me "No path found":

But this is what I get when I send money from "Charlie" to "Alice": "Failed after 10 attempts".

What is going on?

[Rath_]

[...]and waited for 3 confirmations. (Not sure why they've chosen 3)

It's a hardcoded value which you can freely choose in other implementations for each channel separately. Three is the most common value as far as I remember.

But this is what I get when I send money from "Charlie" to "Alice": "Failed after 10 attempts".

What is going on?

Did you make sure to spend some coins from Alice's channel? As I wrote in my previous post, you won't be able to receive any coins unless you make some room for incoming funds first. You can use the testnet version of yalls.org for that. Also, you can double-click on a channel and you should see how much exactly you can receive through that channel.

[BlackHatCoiner]

It's a hardcoded value which you can freely choose in other implementations for each channel separately. Three is the most common value as far as I remember.

Shouldn't this be just a default option? Not a hardcoded value. Same thing for the minimum amount of 2 mBTC.

Did you make sure to spend some coins from Alice's channel? As I wrote in my previous post, you won't be able to receive any coins unless you make some room for incoming funds first. You can use the testnet version of yalls.org for that. Also, you can double-click on a channel and you should see how much exactly you can receive through that channel.

The channel's capacity is 3 mBTC and it says that I can send 2.96416 mBTC. I sent 0.0015 mBTC on a testnet service (?) and it seems it worked:

Once I did, I closed the channel afterwards. Should I? This is the transaction that was broadcasted when I did: 46b6b2cc6570263a3a21a0ce20612d8952f5bd9a6ffa1914a14860c328270500

It's a multi-signature address sending 0.00299665 TBTC to one of my change addresses. Shouldn't there be an extra output with 0.0015 mBTC?

[Rath_]

Once I did, I closed the channel afterwards. Should I?

I wanted you to try receiving a payment after making a few small purchases on Yalls since you should have gained incoming liquidity this way.

It's a multi-signature address sending 0.00299665 TBTC to one of my change addresses. Shouldn't there be an extra output with 0.0015 mBTC?

0.0015 mBTC is equal to 150 satoshis which is below the dust limit. If an output is below the dust limit then it is added to the transaction fee automatically.

[BlackHatCoiner]

I still don't understand, though, why I can't make a simple LN transaction with two different electrum wallets. I've tried it with the link you gave me (yalls.org), but it doesn't seem to be the same when I try to pay myself. Please correct me if I'm wrong anywhere:

On the first wallet I open a channel with a LN node depositing 5mTBTC. On the second wallet I open a channel with the same LN node depositing again, 5mTBTC. I generate a LN invoice from the first wallet and enter it on the address' input field of the second wallet. I enter 2mTBTC and I click "Pay". This is what I get:

(The question mark doesn't do anything btw)

[DireWolfM14]

On the first wallet I open a channel with a LN node depositing 5mTBTC. On the second wallet I open a channel with the same LN node depositing again, 5mTBTC. I generate a LN invoice from the first wallet and enter it on the address' input field of the second wallet. I enter 2mTBTC and I click "Pay". This is what I get:

You need to open up some incoming capacity in one of the wallets.  On the "Channels" tab click on the swap button.  Send some (or all) of your lightning funds back to on-chain BTC.  That will open up some capacity for you to receive incoming lightning transactions in that wallet.

See my post here: https://bitcointalk.org/index.php?topic=5308304.msg56067975#msg56067975

[nc50lc]

On the first wallet I open a channel with a LN node depositing 5mTBTC. On the second wallet I open a channel with the same LN node depositing again, 5mTBTC. I generate a LN invoice from the first wallet and enter it on the address' input field of the second wallet. I enter 2mTBTC and I click "Pay". This is what I get:

Alternatively (aside from the reply above), you can send some testnet BTC here: https://starblocks.acinq.co/ and that should open up some reveiving capacity that you can see above the channels tab.
On the upper-left hand side, it says: Can send 0.00XX BTC; can receive 0.00XX BTC and it's self explanatory.

[BlackHatCoiner]

You need to open up some incoming capacity in one of the wallets.  On the "Channels" tab click on the swap button.  Send some (or all) of your lightning funds back to on-chain BTC.  That will open up some capacity for you to receive incoming lightning transactions in that wallet.

Oh, alright. I successfully made a LN transaction with electrum. I do have some questions, though. First of all, on "Swap" it shows that this service is powered by Boltz backend. What does that mean? Is it centralized? Or the backend source files are brought by Boltz? (contribution)

Secondly, when I swap my funds to increase my receiving capacity, where do they go? I checked a block explorer and it showed me a transaction in which a multi-signature address spends an output to one my receiving (bech32) addresses. Also, why was it parent? Shouldn't it be just "Unconfirmed"?

Alternatively (aside from the reply above), you can send some testnet BTC here: https://starblocks.acinq.co/ and that should open up some reveiving capacity that you can see above the channels tab.

For some reason it shows me the error below, while I have enough sending capacity:

[nc50lc]

Alternatively (aside from the reply above), you can send some testnet BTC here: https://starblocks.acinq.co/ and that should open up some reveiving capacity that you can see above the channels tab.

For some reason it shows me the error below, while I have enough sending capacity:

Now, that must be a pathing issue between your channel to the other Electrum wallet's channel, because not all of them are well-connected to the rest of the network or connected to a "super-node".
Try opening a channel to the same nodeID on both Electrums, after establishing channels, restart Electrum and wait for a few seconds 'till "95% +" connection to the lighting network.
Then try to send a new lightning transaction between the two Electrums.

Here's an example, sent from one testnet Electrum to another with channels connected to the same nodeID:


In real-world usage, pathing will be less troublesome because there are way more channels in the Bitcoin than Testnet.

[Rath_]

A new update of Electrum was released two days ago. It has brought quite a few improvements to the Lightning implementation.

* Lightning:
    - recoverable channels (see below)
    - trampoline payments (see below)
    - support multi-part-payment
    - support upfront-shutdown-script

The changelog explains each new feature quite well, so there is no point in explaining it here again. I will try to update the guide to match the changes by the end of the week.

Also, submarine swaps are now available on Android devices.

Edit: It looks like multi-part payments are not explained in the changelog. Basically, any payment can be split into smaller chunks and sent through different channels. This can drastically decrease the failure rate of transactions as well as make some of them cheaper (see this post).

[Rath_]

I have just updated the guide to reflect the changes made in the recent update. The biggest change is support for trampoline nodes which are now used by default. While it doesn't take much time to download the network graph right now, it is a significant improvement which will be more useful in the future. I also added a short FAQ section. If any questions come to your mind, don't hesitate to ask them and I will put them there.

[blueflue]

i just opened my fist lightning channel using this guide.
Does anyone know why the amount of "Can send" is only 58% of the Capacity of the channel?
Whats up with the other 42%? Can i not use them at all?

[Rath_]

Does anyone know why the amount of "Can send" is only 58% of the Capacity of the channel?
Whats up with the other 42%? Can i not use them at all?

That sounds weird. Can you share more details? What node did you connect to? How big is your channel? You can also share a screenshot of your channel details with blurred funding outpoint and channel id if you want to.

[blueflue]

Does anyone know why the amount of "Can send" is only 58% of the Capacity of the channel?
Whats up with the other 42%? Can i not use them at all?

That sounds weird. Can you share more details? What node did you connect to? How big is your channel? You can also share a screenshot of your channel details with blurred funding outpoint and channel id if you want to.

its pretty much the same as your image from first post, except for the significantly lower "can send". Capacity is the minium amount with 0.002 btc. Remote Node ID from suggested peer.
I would like to not share an image due to privacy reasons.
Since i'm new to Lightning, does this mean the 42% is not usable in this state or does it change once i make a transaction?

[Rath_]

Since i'm new to Lightning, does this mean the 42% is not usable in this state or does it change once i make a transaction?

It should show the correct value from the beginning. I don't think anything is going to change once you have sent a transaction. As you can see on my screenshot, I also opened a 0.002 BTC channel and I was able to send about 90% of the funds.

I suspect that this might be because of the node you are connected to. It sounds as if the required channel reserve was extraordinarily large. Would you mind sharing the id of your peer either here or via a private message? No one will be able to find your channel because Electrum creates private channels which are not advertised across the network.

[blueflue]

I have sent you a message with the Node ID.
If i close the channel, will i get the total capacity minus transaction fees back to my wallet?

edit: since i reached the limit for private messages, i'm replying here.

        "local_balance": 200000,
        "local_reserve": 2000,

would that not mean 1% is reserved and not 10% (198000 sat)? Its the same in your image. I dont see the correlation to the "can send" amount.

I'm using the latest 4.12 version. 3 restarts so far and no change.

[Rath_]

It took me a while to figure out what could possibly be wrong.

Since I don't have any open channels in Electrum at the moment, I experimented a bit with my LND node. I have recently spent 0.00591658 BTC on a channel opening transaction. Right now, I can spend 578 053 satoshi through that channel and its reserve is 5916 satoshi. 578 053 + 5916 = 583 969 satoshi, so it turned out that I was also missing some coins. I found an additional parameter called "Commit Fee". This value tells how much money you are going to pay for the closing transaction fee if either you or the other party broadcasts the current commitment transaction (a transaction which records balances in the channel). In my case, it was equal to 13 605 satoshi. 578 053 + 13 605 = 591 658 satoshi. Great!

So, it looks like both you and the other party signed a commitment transaction with an unnecessarily high fee. I am not sure why that happened - transaction fees are extremely low at the moment. Theoretically, the commitment transaction fee should be updated once you send an off-chain payment, but I am afraid that the node you are connected to might still force you to sign another commitment transaction with a huge fee.

I don't remember if you can specify the closing fee manually if you close the channel cooperatively in Electrum. In my opinion, this would be the best option for now. I can help you choose a better node next time.

[blueflue]

This value tells how much money you are going to pay for the closing transaction fee if either you or the other party broadcasts the current commitment transaction (a transaction which records balances in the channel).

Does this mean if i close the channel i will have to pay a ridiculous fee for the transaction? that would be about 42€ as of now.

[Rath_]

Does this mean if i close the channel i will have to pay a ridiculous fee for the transaction? that would be about 42€ as of now.

That's very likely. As far as I remember, even if you select "Close channel" instead of "Force-close channel", you won't be able to specify your own transaction fee. I believe that a cooperative close (the first option) should use a much lower fee, but I am not that familiar with Electrum implementation of the Lightning Network so don't take my words for granted

I have just found a similar case to yours on the Internet. It looks like some other people had the same problem with this particular node.