Topic: [BTC] If long term most transactions happen on Lightning Network - HUGE RISK? (Read 216 times)

bitcoins initial vision was a digital cash for the unbanked
but with tx fee's of ~$5 right now. people in developing countries who earn ~$1-$5 a day in labour are not going to pay more than a days labour just to transfer money nor will they pay it just for their membership entry (open/close session) of LN.

lets put it into prospective. using the same mindset of rd world countries. but in numbers of equivelent daily value that a 1st world country can understand
US minimum wage=$7.50 . so $75 for a 10 hour day
would you pay $75 just to use paypal for a month? or $75 for a transaction through western union
no?. well now you understand how developing countries feel when you think its ok for $5 tx which is their daily cost of living

anyway...
the security economics of 2019 with btc of $6k- $10k the network security was $75k-$125k a block
and yes right now miners want btc price to be $12k- $20k so they can secure the network for the same $75k-$125k of the last year

but imagine the block reward was miniscule. and reliance on fee's were more relevant

a 2in-2out tx = $43 a tx to total $125k (2900tx average block)

dev economics are to say 4mb weight is ok but not have 4x tx count allowance for that 4mb
they want to keep tx at below 3k a block to push for higher fees.
yep they want onchain fees way above $5 a tx now and hope for $40+ a tx in future

but what common sense economics should be is have more tx so that fee's per tx are lower

but nah. devs dont want low fee's onchain because it wont incentivise people offchain to pay their offchain fee's for custodian services so that their companies can repay investors
stupid thing is by increasing onchain fee's will just make people not even want to use BTC initially to get into LN.
they will just use fiat->altcoin->ln
thus end up making altcoins more of a useful 'reserve curency' and altcoins LN as the digital cash

If all transactions happen off-chain,Bitcoin will NOT be Bitcoin.It would be simply dead.
If there are zero transactions on the BTC blockchain,miners won't generate any revenue from fees,therefore they will quit mining.If there aren't any on-chain BTC transactions,the market liquidity of BTC and the demand for Bitcoins would be close to zero,which means the Bitcoin price would be close to zero as well.
I don't think that the majority of the Bitcoin Core diehard supporters actually trust the Lightning Network project and would start using LN in the future,so your theory simply won't happen.

Lightning Network is only intended for one small subset of use you will rarely every do: Instant payments. The infamous coffee purchase.

Most payments can wait hours or even a day or two, you can do that with regular on-chain transactions just fine. For this picky crowd that somehow can't seem to organize themselves enough to pay in advance or such, this invention was made. I guess its better than exchanging for an altcoin or using a high fee.

Fortunately its optional. You don't have to use it, ever. Most transactions won't be made using LN, and its creators recommend it for small amounts anyway.

"BTC If long term most transactions happen on Lightning Network," the congestion on the main network will be gone. In which case, the tight competition of transactions is also gone which, in turn, means that transaction fees will also significantly fall down. Consequently, the main network will once again be attractive to transactions involving moderate amounts.

Let the small coffee transactions be happening off-chain to avoid clogging the main network. At the end of the day, all these transactions will still end up broadcast into the network in bundles upon closure of channels, and fees will still be paid.

Exactly. Transactions of high amounts will probably go directly on chain as they go now.

Additionally, the once the channel is closed, the total amount transacted in LN will be registered on chain as well.

You are wrong because you decided to write a critique about something  before reading nearly anything about it....

core are forcing them though. and advertising people should use it. and getting their fan girls to troll the forums and twitter to announce how great broken LN is and how broken the great btc is
for instance. the games of core devs..
segwit did not discount fee's. its not even a new tx feature any more useful onchain than legacy. its sole purpose is to allow scripts for lockin funds to then play around with other tokens on other networks

again segwit didnt discount fees(a promise that it would to incentivise users) instead it x4 up legacy fee's

but even if some users are using segwit. are transactions still ~$0.10 or at the 4x discount of under 3cents like proposed when advertising it?

just look at the last 4 blocks at time of posting
b 631445 ~1900tx 1btc fee total = ~$5 a tx
b 631444 ~2500tx 0.4btc total fee = ~$1.60 a tx
b 631443 ~2500tx 1.3btc total fee = ~$5 a tx
b 631442 ~2500tx 2.1btc total fee = $8 a tx

devs want higher fee's because they also want less transactions.
but less transactions on chain= less users making those transactions=less people wanting to validate/archive the data because they are not daily users

core devs dont want to use bitcoin as 'digital cash' they want it as the reserve currency for custodian(banks) to have and have users make their daily needs purchases on other networks via custodians

having a $5 fee to open and close. makes people not want to have to open and close daily or weekly. so they end up just locking funds up for longer. which you even admit (and i repeated for other readers) means people are forced to not use bitcoin for normal transactions. it was even your own words. 'no one would want to pay $5 for a $10 tx'

imgine if your only method to transit funds was through paypal
and they raised the normal TX fee to $5 a tx. but then offered you paypal+ which is a $5 account opening fee and then 1cent a tx..
you ofcourse would be swayed to no longer use regular paypal. and then you will be swayed not to close the paypal+ account every few days. but try to keep it open and funds in paypals custody for 1-6+ months

so there is the 'force' you think doesnt exist. even when you literally spelled it out

This is where you wrong. Not all transactions will happen off-chain. LN isn't forcing anyone to use it, and it doesn't directly affect the base layer, so people will still be using it. If adoption will keep increasing, the blocks will always be full, and LN will help with smaller transactions that wouldn't generate much fees anyway, because no one would want to pay $5 fee for a $10 transaction, but paying $5 to move $10,000 is pretty reasonable, which is what will happen with onchain transactions.

The important thing to understand about Lightning is that when all transactions happen off-chain, miners don't generate fee revenue. This undermines the security and sustainability of the network, which is all based in mining profits. With each halving event, miners become more and more dependent on transaction fees, until the subsidy is removed entirely and transaction fees is the ONLY income miners will generate. It's a ticking timebomb under Bitcoin - scale or die.

Miners don't just secure the network out of the goodness of their hearts, it costs a lot of money in electricity. This is the paradox of a system like lightning - it is supposed to enhance Bitcoin by making traffic happen off chain, but instead it undermines all the economic incentives that make Bitcoin work to begin with.

Could you tell me - why am I wrong?