will become just another banking system that is just as bad as what we already have.
Now you catching on to what they planned from the beginning.
LN was never about scaling ,
it was about introducing a network that could add offchain fractional reserve Banking to Bitcoin while pretending not to.
The LN network may have a quite a few issues, but there is no way to make it a fractional reserve. Each tx on the lightning network must be able to generate a valid closing tx on the blockchain(s). I suppose that you could do atomic swaps with some other coin that is supposedly redeemable for BTC 1 for 1. However, if people fall for that, they a stupid.
LN runs offchain, pretending that IOUs are the actual funds, they are merely IOUs.
As such, the IOU value is a pretense of LN code , and code can be modified/updated or tricked in some instances.
1. Code update has already been written, that allows a direct fractional reserve in LN, it is only 1 software update from reality.
https://www.rene-pickhardt.de/index.html%3Fp=2131.html
2. The top 4 mining pools could 51% attack btc and double spend,
this would trick LN into loading channels with bitcoins, that would be redirected to another onchain address.
Basically counterfeiting an LN Funds IOU channels.
It only needs to be long enough fo LN to consider it valid,
and there are proposals underway to allow channel creation before funds are even locked,
so a double spend could be pulled off by anyone smart enough to pay zero fees to fund a LN channel
and then pay a high fee so the bitcoins are gone before actually locked onchain.
3. Sell Lightning Channels directly for fiat and oversell the number of channels.
This allows a bypassing of the blockchain in some aspects.
IE: You buy a Thor Lightning Channel for fiat, and then pay a utility company,
which you think is being paid from their LN channel,
however the company running the thor channel pays the utility company with their gift card system instead.
The directly allows fraction reserves as the company running the thor channels only need enough LN funds to cover payments,
while using the additional funding for short term money markets earning interest at your expense.
LN is not like the blockchain , it is like a bank and that gives them lots of ways to play with your funds,
even as far as loaning it out without your knowledge. Now you can pretend that none of this is happening,
and as long as they make the payments, then no worries,
but all fractional reserves eventually have bank runs due to lost faith iin the system.
Bitcoin Onchain ended fractional reserve banking , LN Offchain restored fractional reserve banking to enslave the future generations.
Offloading Bitcoin Transactions to Gift Cards or Exchanges do a better job and are easier to use than LN.
And just to be clear LN used incorrectly actually increases BTC onchain transactions instead of decreasing it.
https://bitcointalksearch.org/topic/m.50330030
And just to be clear LN used incorrectly actually increases BTC onchain transactions instead of decreasing it.
https://bitcointalksearch.org/topic/m.50330030
With gift cards and debit cards, someone is just going back to the fiat system. We all know the perils of using an Exchange for a wallet. If the exchange doesn't care for your particular transactions, they can just freeze your account and make you go through a bunch of red tape to get your coins back. Also, exchanges are big target and hackers like to go for the big score.
True , but gift cards have the scaling capacity of visa and higher merchant adoption due to ease of use.
True , many exchange are unsafe for large amounts,
what makes you think LN hubs are going to be any safer once they become used on a regular basis.
Hackers go after the money, say a hacker compromised your PC or LN channels, they can send funds out to another LN channel,
data wipe the LN hub, and steal your funds, by buying other coins, atomic swaps or cashing out directly to fiat.
LN transaction does not have a Public open view of transactions like onchain bitcoin does.
Tracking LN funds crimes will be more difficult.
Plus you can always sue any exchange owners that steal your funds,
when your LN funds are stolen or simply lost due to the latest LN code bug, aside from scratching your butt ,
what legal recourse do you have, none.
https://coinspice.io/news/lightning-network-warning-please-dont-lose-money-learn-from-my-recklessness/
But yet, the people here ,
claim that by offloading transactions from Bitcoin to the LN network , that Bitcoin scaling is increased.
When the actual Number of the BlockSize was only increased to a max of ~1.7Mb from 1 Mb when no further plans to increase more.
In effect , limiting the future growth of the blocksize to intentionally force high fees to force greater acceptance of LN offchain to those too poor to afford onchain transactions on a regular basis.
Offloading is not the same as Scaling.
claim that by offloading transactions from Bitcoin to the LN network , that Bitcoin scaling is increased.
When the actual Number of the BlockSize was only increased to a max of ~1.7Mb from 1 Mb when no further plans to increase more.
In effect , limiting the future growth of the blocksize to intentionally force high fees to force greater acceptance of LN offchain to those too poor to afford onchain transactions on a regular basis.
Offloading is not the same as Scaling.
OK, I'll start calling it offloading then. In any event, it will allow people to make more transactions and they can be rest assured that when the close the channel, they will posses every satoshi entitled to them, less the miner fee and less the extra millisatoshis.
Be careful , many in your circle , won't be happy if you upset their PR apple cart with the truth.
Also LN will only decrease transactions , if the LN payments are properly structured.
1. Funding amounts need to be at least $200 or higher per channel
with payments $20 or less to see any moderate improvement in transactions offloaded.
Plus the payments need to be with the same individual. (In a real world scenario.)
Not following a well defined payment structure, could actually cause an increase in onchain Btc transactions not a decrease.
Scaling implies Bitcoin itself could handle the volume,
offloading mean LN can handle the volume and bitcoin can't.
What do you suggest BTC do? Have a contentious hard fork every year or so to increase the blocksize? As we can tell, just having a softfork creates tension, much more a hardfork. I suppose BTC could just have one hardfork to obliterate the capacity cap all together. However, I am not certain miners are going to appreciate the low transaction fees that will result. The only solution will be for the miners to set their own minimum fee and ignore all the other transactions. offloading mean LN can handle the volume and bitcoin can't.
1 hard fork up to a true 8MB block size while allowing a tiny 3% increase in blocksize on a yearly basis built in,
is all that has to be done. And it only has to be done once, this type of thing was proposed in the past to avoid the nonsense argument over blocksize, that non-mining nodes can't keep up. Non-mining nodes that don't earn money to keep up, are irrelevant, and will fall one day anyway.
(Hard drive and other needed infrastructure is increasing faster than 3% yearly so a 3% increase is literally nothing.)
Funny how LN will make IOUs transactions in milliseconds and non-mining nodes are holding back bitcoin because they are unable to cope with 10 minute intervals blocks.
Doubtful LN hub operators will whine , they'll just update their hardware.
While usually Khaos77 posts nonsense, this time he's spot on. Like a broken clock, I suppose.
From the beginning LN has been designed as an hierarchical trap.
From the beginning LN has been designed as an hierarchical trap.
Luv you too,
