The founder of Bither Wallet, Wen Hao to share his wisdom with our audience.Application scenario expansions of Bitcoin as payment.Tong Yang: Wen Hao, the founder of Bico Wallet, also the developer of the Bither wallet. Graduated from Computer Science department of Beihang University, he. provided many years of technical services in National Sports Lottery Center and took charge of a team to design and develop a lottery sales and management system. After entering the field of bitcoin and blockchain, he led the team to develop the“Bita Wallet”, the only wallet in China recommended by Bitcoin.org. Mr Wen then developed a multi-block chain asset wallet “bither” that can easily be used by newbies, as well as a hardware wallet “bit shield”, etc. Mr. Wen enjoys a good reputation in the industry of blockchain .
Tong Yang: The main application scenario of Lightning Network is in payment, which will promote currency circulation. Therefore, if the lightning network blooms, it will increase the liquidity in the Bitcoin economy. What is its impact on Bitcoin and cryptocurrency?
Wen Hao: First of all, I lay the background of my speech. When I first discussed the lightning network technology with Auntie and Dongshu three years ago, we had a consensus, namely the “Lightning Network White Paper”, which is an extremely important document in the currency world next to the white paper of Nakamoto. The lightning network can have a huge impact on bitcoin and cryptocurrency, and it will have a complete subversive effect on the future blockchain ecology. The main application scenario of lightning network is payment. We all know that the resources on the blockchain are overall limited, and the limitedness testifies in events such as the BCH fork caused by the bitcoin block size dispute, and the later high TPS concept developed by the public chain from the ether to EOS/TRX. These are actually in order to better meet the user needs for low-cost and high-efficiency payment. However, the chain capacity is always limited, even if , Like EOS, it is still limited by the resources on the chain (such as CPU, memory capacity). The lightning network can be said to be very powerful and completely solve this conflict from another angle, and obviously its significance is revolutionary.
Wen Hao: With the development of Lightning Network, Bitcoin payment user experience will approach or surpass that of Alipay and WeChat payment, which will greatly expand the application of Bitcoin in payment scenarios. Real payment demands lead to greater circulation of Bitcoin, and render digital currency such as Bitcoin into the application functions. User behavior will be reshaped from the exchange to the real application scenarios such as wallet and payment. It is obviously fundamental. You can compare with the Fiat currency such as RMB/USD trading proportions in the foreign exchange market, and realize the importance of user behavior change to cryptocurrency development. In addition, due to the decentralized and untrusted nature of the lightning network, the model can also extend to the cross-chain decentralized transactions, having subversive impact not only on the current centralized but also on decentralized single-chain exchange. To illustrate, you can imagine trading BTC/ETH/EOS/USDT through the lightning network in the future without trust needs. The cost almost nonexists, and with instantaneous transaction, there is no depositary requirements. You don’t have to deposit coins, you don’t have to worry about the platform runaway, which is obviously revolutionary for the development of the blockchain.
Tong Yang: The second problem is that Lightning Network needs to cooperate with wallets when expanding the payment. How difficult is the lightning networks’ current integration with other technologies such as wallets? What are the attitudes of wallet startups to the lightning network? Will the lightning network help with the development of the wallet market?
Wen Hao: Lightning Network needs to cooperate with many wallets when expanding the sphere of payment. correct. First of all, many people may think that the exchange will also participate in building the lightning network. In fact, the lightning network is essentially the opposite of the fudiciary model. Inside the exchange, it’s natural to transfer coins from A account to the B account at low cost and high efficiency (just need to tweak a record in the database with no change on blockchain), and if you want to use lightning network, you have to extract coins. the logic is reversed, Therefore, in fact, the lightning network architecture itself has little to do with the exchange. Of course, the exchange can actually establish a lightning network model, to simulate the decentralization, instead of transfering and receiving lightning network transactions, in this sense, you lose the significance of decentralization in no need of trust. We can call it the “pseudo lightning network” model.
Wen Hao: At present, some wallets experimenting with lightning network technology actually adopt this kind of “pseudo-lightning network” model. With this model, users can try and experience the characteristics and benefits of lightning network, but finally, lightning network still will develop into a “true “ one that is completely decentralized with no trust requirement, but we have to wait and see. For the current integrated lightning network, there are two kinds of difficulties in technology fusion: 1. Integrating the “pseudo-lightning network”model, it is actually not difficult, we will soon provide a lightning network trial framework for bitpie.com users. 2, integrate”true lightning network” model. It’s more difficult for the integration part, but in general, it is ok. However if we aim to provide a seamless, easy-to-use, safe and reliable “true lightning network” wallet model, it is much more difficult, and all aspects of design features need to be fully considered.
Most wallet entrepreneurs are still on the sidelines for the lightning network. Of course, some emerging wallets may want to grasp the breakthrough opportunity in the market by lightning network application. But it is still difficult overall, because the current lightning network is still in an experimental phase. In this matter, I personally would like to appreciate the technical efforts the Blockstream team has been putting forward in the past few years. Russell Rusty has been writing the base-level protocol, which is significant for the lightning network application today. Our team has also been gradually increasing our technical investment to help users experience faster, better and safer lightning network, which is very important for the wallet market. As the expansion of the lightning network is actually a wallet, and the expansion to the decentralized transaction will render an integrated seamless experience. On this point, through the efforts of the bitpie wallet on the ecosystem of the EOS/TRX over the past few months, we have seen the decentralization power to a certain extent.There is no need for a centralized exchange for EOS and TRX , and the development of Lightning Network will accelerate this trend, bringing cross-chain decentralized exchanges to every user. The wallet is the bridge and link of vital importance. Interested friends can ask EOS and Wavefield users whether they need a centralized exchange.
Tong Yang: The wallet’s accounts are decentralized, and it is more secure for users, but some people argue that after joining the lightning network, there emerges a centralized security risk. In your opinion, will it reduce the security of the wallet?
Wen Hao: The definition of Security is always relative. Even if the wallet account is decentralized, users still need to design a suitable solution based on their own asset charateristics.
For example, for large assets, you should not use hot wallets, but use open source or secure hardware cold wallets like bit shield bithd.com. For another example, large assets managed by multiple companies and organizations should use multiple signatures of bit shields. With the wrong solution, the risks are high, and this is normal as these security strategies are not in fact having anything to do with the lightning network. Due to the characteristics of lightening network innate model, the channels inside are in hot wallet states. From this point, its safety is still limited. Therefore, users should not put large amounts of assets in the lightning network, but instead put the assets that meet real-time payment demands in the channel. For the security of the wallet, the lightning network itself does not increase the security risk,but it will increase the technical complexity (such as the channel status record, etc.), so the service should be thoroughly tested to ensure asset security. Besides, there is a neglected notion in industry at present that with the development of lightning network applications, large nodes will inevitably appear which will provide channels for many users. Services will be provided such as the establishment and shutdown of the channel, as well as the channel state maintenance.In this sense, it is most suitable for wallet such as the bitpie to serve the functions,as wallet is for ordinary users.Or we can say it’s suitable for the mining pool (such as BiYin) to provide node services because the mining pool has advantages in ensuring transaction confirmation and the assets storage needed in the channel. Of course, it is better for the wallet and mining pool to to cooperate to provide large node services.
Wen Hao: But this kind of big nodes actually are confronted with a problem, that is, when you provide lightning network node service for a large number of users, you have to hold a lot of coins in the channel, which accumulated to an astronomical number. We will not talk about the revenue model of holding coins (after all, the lightning network node can charge a small fee appropriately), but we must take security into consideration because the coins in a large number of channels are In the hot wallets, thus the nodes must be well designed to ensure security. (in fact, three years ago, A Biao and I discussed on the security risks.) Our security foundation in this regard is good, we have already developed The ChainCloud.com blockchain cloud platform two or three years ago, which can provide customers with a hot wallet experience with a cold wallet model. In the past two or three years, the bank has stored a large amount of user assets without a single security breach. Therefore, in the future, on Lightning Network, we can also provide users with better and safer node services based on these technological reserves. Of course, for ordinary users, it is not so terrible, because lightning network is a decentralized model without trust requirements. If the big node runs out of order, you don’t have to worry about the risk of asset security, just disconnect the channel, and the coins still in your hands, triumphing over exchange robbery. In a nutshell, the lightning network is revolutionary and will greatly transform, and subvert the ecology of the traditional crypto and blockchain industry. From this perspective, it should arouse enough attention from every participant in the industry.
For the details of interview:
http://www.cointime.com/news/blockchain/11367.html
