Lightning Network and its great importance to Bitcoin network

[thecodebear]

Thank you for your explanation, although you are going more deep. I believe with time, I will have a full understanding of what you are saying.

You're welcome. If you're interested to learn more about LN, I fully recommend this book: https://github.com/lnbook/lnbook.

and I guess you want to have backups of your channels transactions.

This is a great problem, actually. Bitcoin users are used to backing up a seed phrase, and now you're asked to do frequent (automatic) backups, which are a lot more probable to fail with a disk corruption.

Or for some people (honestly probably most people will choose this) it'll just be better to treat LN as a checking account at a bank and use a custodial LN wallet and not worry about any of these things.

It's just that relying on custodial LN to save the day is hypocritical. The entire purpose of lightning is to respect self-custody, and most people simply disregard this, reasonably; setting up a lightning wallet properly is a pain in the neck.

Yes agreed backing up is likely an annoying problem. Though I suppose one could setup a system where it just automatically backs up often to another drive. But this would require some technical knowhow and so the average person is not going to set this up.

Well realistically most people in the world aren't going to care about self custody. Most people are going to buy Bitcoin to save money because its price goes up. And most people are going to want to spend their bitcoin savings in a simple easy way which would be custodial LN. Ideally developers get the LN simple enough so that setting up your own node and managing it is easy for the average person. But until then, if it ever gets to that point, the average person is going to be fine having their savings in self custody and their "bitcoin checking account" in custodial LN node. And for those who aren't fine with that and want to take full advantage of self custody they of course can do that, but still of course hopefully some of these issues get solved to make it easier to setup.

Just remember, most people are not technically inclined. The vast majority of people are not gonna care about self custody, they are gonna care about ease of use. We already see that with on-chain bitcoin despite the fact that it is very easy to simply make a private key and send your bitcoin off exchange. So while it will definitely be beneficial for LN if some issues get solves and ease of use gets improved, most people are honestly just gonna choose the easy to use option and that will be custodial LN. Bitcoin gives you options. Convenience with custodian, a bit less convenient and self-custody. That's a beautiful thing. In the fiat system you only get the first option. Let's not say custodial LN is hypocritical, because the majority people WILL choose that for the convenience. But yeah at the same we hope that setting up one's own node and managing it becomes easier and easier so those who want the highest service out of Bitcoin and LN can get it without a lot of hassle.

[BlackHatCoiner]

Well realistically most people in the world aren't going to care about self custody. Most people are going to buy Bitcoin to save money because its price goes up.

I understand and agree, but here's the problem: the whole point is self-custody, not (only) because it gives the user some significant advantage. It's the whole point, because it makes the network unstoppable by state actors.

I'm myself using custodial LN when I want to make a payment from my mobile phone, and it's fine for small amounts, but it's not the right path to take, IMO. Custodial solutions create money transmitting businesses which besides regulatory problems, act as central point of failures. What if the authorities decide to take down LN hubs with the excuse that they facilitate money laundering? At the current state, network's liquidity would seriously reduce. 

[DaveF]

Well realistically most people in the world aren't going to care about self custody. Most people are going to buy Bitcoin to save money because its price goes up.

I understand and agree, but here's the problem: the whole point is self-custody, not (only) because it gives the user some significant advantage. It's the whole point, because it makes the network unstoppable by state actors.

I'm myself using custodial LN when I want to make a payment from my mobile phone, and it's fine for small amounts, but it's not the right path to take, IMO. Custodial solutions create money transmitting businesses which besides regulatory problems, act as central point of failures. What if the authorities decide to take down LN hubs with the excuse that they facilitate money laundering? At the current state, network's liquidity would seriously reduce. 

I have been wondering if there is a business model in having a well funded well connected node that people who run their own LN nodes can connect to so they can have self custody BUT they do not have to worry about finding routes. If you do not plan on receiving BTC then you don't have to worry about having inbound liquidity.

There are enough 1 button install nodes (mynodebtc, umberl, raspiblitz, etc) that setting one up is now more a 1 click thing. Having a 1 click route too might be good.

The issues now are that a lot of the large well connected places want a lot of BTC locked up if you want to open a channel to them. I was thinking that having one set to allow you to open a channel with BTC0.0005 or BTC0.001

Not going to do it, don't have the time or BTC, but just thinking if there might be a business model in there.

-Dave