Topic: Lightning Network Discussion Thread - page 13. (Read 29772 times)

Do you need a full node, or can run in light mode?

Hahaha. You are right. I will never be smart enough to understand why bigger blocks will be ok because "Moore's law", and then ending the debate with "non-mining nodes do not matter".

I will also not be smart enough to understand that Bitcoin Cash is Bitcoin because "Satoshi's vision".

I will reply on the rest of your post later. I admit that you made good counter-points. Let me internalize them first after I enjoy my Saturday morning.

See my friend, Lightning Network basically is an offline scalability solution for bitcoin. It is not bitcoin or any other cryptocurrency tokens. With the help of lightning network, you and your partner can do frequent, micropayment in a faster way and a lower fee via state channels. Bitcoin main chain only needs to record the beginning state and final state of the channels.

You LN guys are just lemmings running for a cliff.  

Enjoy your Banking 2.0  

George Santayana

And repeat it , you shall.




Last post, Good Luck Lemmings.   

You aren't actually responding to what I said. I said that even if the network ends up dominated by big nodes that it wouldn't be clear that this would result in the big nodes "running the show" and that you would need to detail the mechanism by which big nodes get some sort of power and control over the network by virtue of being big. You responded to that by further trying to convince me that it would in fact be dominated by large nodes. This is not an appropriate response to what I said. It is as if you are talking to someone else or some sort of imaginary strawman that you made up. Either way, not very impressive.

You've evidently knocked yourself on the head a few too many times already.  You don't need a powerful machine to run a Lightning node.



Prove it then.  Rather than just talking out of your backside, go make that happen.  If it's just a small update, even a total halfwit like you should be able to implement it.  If you're so determined to prove Lightning can't work, please go right ahead and break it already.  I'll wait.  Except you can't.  Because you're nothing but a windbag.  All talk.  



Cool story, bro.  Come back when it actually happens.  

Bold, blue emphasis added to your quote to highlight the issue.  Simply having a banking licence isn't an automatic pass for meeting KYC/AML requirements.  Banks can only comply with KYC/AML if they can prove they're holding the necessary details for all their account holders.  Tell me how they're going to do that if no one gives them the details they need.  The moment any LN node asks for personally identifiable information, the moment they lose any hope of someone routing a payment through them.  Users will just transact with other nodes.  

Your fantasy about banks taking over is based on the assumption that the banks themselves would actually want to undermine their established and highly profitable fiat business model (not happening in the real world), the assumption that LN users would be willing to undermine everything we've built here to replace the banks (not happening in the real world) and the assumption that regulators would have any practical way of following all the channels on the Lightning Network and tying the identities of all the participants to a physical address in order to bust their door down (not happening in the real world).  

Banks have barely even wrapped their dinosaur skulls around blockchain yet.  They're still at the "hey, we can make our own blockchain but in a private, walled garden and that will mean we can sack some people and have more automation" stage.  They don't want any interaction with their customers via the blockchain, either on or off chain.  They want record-keeping, administration and auditing.  They want cost-savings in doing those things.  They aren't transacting in crypto.  They don't even want their customers using crypto.  They want you using cards, so the surveillance state can monitor what you're spending your money on and where.  They don't want you having privacy.  Please go to your bank and tell them that you are actively involved in cryptocurrency.  Record that conversation and put it on youtube or something.  I'd love to see that.  If you happen to be speaking to a bank employee that knows anything about anything, watch how fast they close all your fiat accounts because they know they can't enforce KYC/AML and they don't want any issues with the regulators.  As soon as they hear the words "Bitcoin" or "Cryptocurrency", they naturally assume there's a risk of money laundering and will terminate their business with you.  That's what happens in the real world.  Try living in it.  People are growing tired of your fantasy-land drivel.

Of all the businesses that will embrace LN, the banks will most likely be dead last.  

You rather use the cost of a new PC matching the specs of a $60 Monthly VPS instead, knock yourself out.
One time Input Cost : New PC with 8 gig of ram ~3 gigahertz running at least an I7 Processor
Monthly  Input Cost  : Internet Access with DDOS Protection included (Dedicated BANDWIDTH @ 1Gbps up/down minimum)
                                2 internet provider in case the 1st one goes down to block LN funds from being stolen      
Electricity Input Cost : Monthly Electricity bill for PC & internet modem
* and if you really want to get detailed include the amount of bitcoins locked in your Hub *

 

Sadly  , You are stupid too.

No , fraction reserve is taking  $1 but pretending to have $10.
All it takes is 1 software update and when you lock 1 bitcoin with LN , the LN hub owners claims it has 10 bitcoins locked and spends the other 9 fake LN/faux bitcoins, while you still only had 1 bitcoin time locked.
When the majority of people leave their funds locked for the majority of time, this fractional reserve system becomes possible, because not enough people cash out to crash the system. (It is called a Bank run.)
Research how banks were first created, and how the factional reserve system came into effect, it is just history repeating itself with crypto instead of gold.
That time lock of two weeks will be increased longer and longer til eventually onchain redemption of bitcoin will not be allowed or just plain outlawed.
IE: You used to be able to go to the bank and exchange your fiat for gold or silver, government outlawed this in the 1900s.
Which is the same time inflation started going crazy and the value of the dollar started to decline, because it's value is based on nothing but the promise of lying politicians.



Being that clueless comes natural to you.  

Banks will run LN hubs, and they will store all of the data necessary to comply with KYC/AML regulations.
So that when the Feds do come after LN Hub Owners, they can show all of the supporting information, and suffer no issues whatsoever.
It is like you forget , they already have a Banking License so they can transfer money with no worries of legal ramifications and as long as they record the necessary data.
Fed shows up to a bank, they show Banking License and the Fed thanks them for their time and leaves.
Fed shows up at your house, no banking license & no money transmitter license, your ass gets hauled to jail and fined for failing to operate under the KYC/AML regulations.

So all the nodes on the lightning network are operating via VPS now?  And your source for this is...?  



So moving the decimal place is the same as fractional reserve now?  If I had a dollar, but instead I chose to represent that as 100 pennies, that meets the definition of fractional reserve?  Well it's a good thing you're here to tell us this stuff, since that's news to me.    



Sorry to burst your bubble, but your earlier predictions about LN being subject to KYC/AML will have to come true first.  The banks won't even be allowed to touch LN, or even Bitcoin at all (including on-chain transactions), unless KYC/AML is enforced in every single country that particular bank operates in.  Until then, no banks will be involved at all.  



No thanks, neither of you are fit to explain much of anything, other than perhaps how to troll a forum.

 

I can honestly say, Hell would literally freeze over before that happens.
But it is good to have goals.  



Definition of the word : Assumption
a thing that is accepted as true or as certain to happen, without proof.

I will replace the term Cost Basis with the Term Input Costs,
to see if you understand that better.

Definition of Input Cost:
Cost of direct material, direct labor, and other overhead items devoted to the production of a good or service.

LN hubs requires a computer & internet access, which no one can deny.
Therefore current prices of a decent VPS are ~$60 per month.
So that $60 is your minimum input cost.
(Notice the time to become proficient running a LN hub was not even included in the input costs.)

So calculating the break even point of what each LN transaction has to meet to match the input cost of $60 is pure math , not assumption.



If someone can impose penalties and Take away your funds,
it directly means that you NEVER had Total Control as you like to keep asserting which is a false statement.

Example: In Onchain Bitcoin where you control your private keys,
No one can Take any funds from you unless you agree to send them the payment.
They can send you a bill, but they can't make you pay, it is your choice.

With LN Multi signature, the LN Hub can grant your funds to the counterparties at any time their rule system dictates without you having any ability at all to block it.
Not the total control myth , you keep propagating, the most you can truly say, is that you have shared control of the LN funds with the hub.



https://medium.com/andreas-tries-blockchain/bitcoin-lightning-network-4-what-happens-when-you-close-half-of-the-lightning-network-b25b330dfad2

20180 minutes is ~ 2 weeks.

So until those time locks expire, he will not regain total access to his funds. IE: Can't spend any until the time locks expire.  

It is an assumption until you run a Lightning node yourself and compute everything. But did you already not say that Lightning nodes do not earn enough from fees?


The same set up in Bitcoin now will happen in Lightning. Merchants will run them because it scales.


Then teach me, because you have said nothing that I can learn from. Everything is propaganda from the big blockers.


You mean cheat in Lightning? Yes, there will be penalties if you cheat.


Possible, good argument, I will read more on that.


Wrong you can broadcast the latest state of your channel anytime. Did Andreas Brekken not close his channels but only having minor problems?


I am here to learn. I will continue debating with you until I am as smart as you.

You assert that prices will be extremely low without proof, ie: showing no numbers to support your arguments
my assertions are based upon the history of bitcoin and the banking system, along with the walmart effect.
How many guys can mine bitcoin for $60 per month, small guys were pushed out years ago, it will be the same with LN.

I guess the part where a bank could make $6 million per month charging only $.20 per transaction was over your head. 


 

Here you go. You dig right down to your core mistake here. You just assert as if it is self evident that if the banks run the biggest nodes they will run the show. That doesn't follow at all. In fact it is unlikely that big banks will even bother trying to run big nodes precisely because, unlike the legacy financial system, running all of the biggest nodes doesn't really give them very much power.

You can't just assert that like its self evident. Lightning network doesn't work like the legacy financial system. You need to actually explain, on a mechanical level, the precise mechanism by which being big gives one the ability to "run the show".

If you had actually read my post , it lists the total monthly transactions required to the right.
You can divide by the monthly total transactions if you like, but the price per transaction will be the same.
1000 transactions per day at $0.02 per transaction (30000 transactions per month)
                  ie: $60/30000 =$0.02 per transaction
100 transactions per day at $0.20 per transaction  (3000 transactions per month)  
                  ie: $60/3000 =$0.20 per transaction
10 transactions per day at $2 per transaction         (300 transactions per month)
                  ie: $60/300 =$2 per transaction

As far as damage, I never claimed their would be damage only that the Banks would monopolize LN and their is nothing you can do to stop them.
Your thoughts that small players are going to be the main LN hubs is what is completely ludicrous.
LN will work as originally designed with the Banks running the show.

Well, this thread is panning out pretty much how I expected. I still don't understand any of it.

I guess this is very similar to being here in the very early days of BTC when there was only one wallet that was pretty clunky and a small bunch of people feeling it all out. Looking forward to seeing how much slicker this all will become. For the masses, and me, to have any hope of using it it's going to have to be.

Thanks! However, if I understand it the right way, I have a problem with this approach: it would be needed to lock lots of funds in penalty outputs if LN sees mass adoption, as the "penalty output" should be big enough to prevent incentives to try it anyway, above all for "malevolent big hubs" which could tolerate a certain percentage of "failure" of the scam intents.

That could even be a problem for mass adoption: many "average Joes" could refuse to deposit more funds than those they're able to really spend in LN. The funds could be spent later, that's true - but that would need, afaik, a on-chain refunding.

I understood the discussion that this isn't the only concept they're thinking about, so maybe there is a better way to be found. Maybe LN-penalty can stay there as an alternative option.

Just out of curiosity: Someone knows why this mechanism called "eltoo"?

Currently, the transaction which founds the channel contains only one output - a multi-signature address which is in control of both parties. The idea is to use only a part of the founding transaction as a punishment. The first transaction would contain two outputs - one with the funds used on the Lightning Network and the second released only if the other person attempts to cheat. Shachain or elkrem preimage make sure that the reserve isn't spent improperly. You can think of the reserve as a security deposit.

I have read the associated Reddit discussion and I still have a doubt about eltoo.

The question arose at Reddit, too: What could be done to prevent that scam hubs simply keep trying to broadcast old channel states? There is no penalty for that behavior at this protocol level, according to Christian Decker.

But how could a penalty be implemented on a "higher level", like Decker says in some moment in the discussion? I think a form of penalty is necessary, otherwise it will become a huge scamfest, or the system will depend excessively on watchtowers and other third parties. I'm afraid that in this case LN would be sort of losing its elegance.

I would be grateful for an example for a higher level penalty implementation understandable by someone who has no IT degree

Decker posted this explanation at Reddit, but I need some clues still:

The second sentence - the core of his proposal - is difficult for me to understand.

A couple of mistakes in your assumptions I think. 1000 transactions a day would probably be way way under what is reasonable to expect for someone who is running nodes as a full time job. Alternatively it might be realistic for someone who is willing to, for the most part, set it and forget it.

Either way you had the completely wrong take away. What you want to do is roughly calculate how many transactions a 60 dollar per month server would be able to process in a month and divide the 60 dollars per month by that number then double it or something to allow for some profit. That number would be extremely small.

Also yes you are going to be able to get the lowest rates from major banking hubs obviously but that is an opt in sort of thing. You can choose not to route through jpmorgan if you wish or you can chose to save some sheckels and route through them. That is each individuals choice. This is not a centralized system. Everything about it is opt in.

And finally, for reasons laboriously discussed previously, a hundred times over, the actual damage that could be done by a bank that could operate at economies of scale like you are talking about is pretty small. They can't just make their own rules because they are big like they do in the legacy financial markets. This is the big insight that detractors seem to be lacking. About the worst thing they could do is pull their liquidity in a coordinated attack but it is reasonable to expect the network to heal from this quickly and almost organically.

It is not an assumption , it is a cost basis from the break even point of maintaining a $60 per month VPS.
Right now people are just doing it for Free and just losing money in the hope profit comes later.

People will only lose money giving you free transactions UNTIL they at least want to break even, and when they want a profit , the hub fees will go even higher.

Sorry to burst your bubble, but Mega Hubs/Banks are the only ones that are going to make large profits from LN and centralized control of bitcoin while doing it.
(No different than Walmart bankrupting the Mom & Pop Stores by competing at a lower price margin and having a higher volume to still make a profit.)

Your lack of understanding , gets really old.
A small code change is all it takes to make 10 LN notes from 1 bitcoin, only a mutiplier in the program code.
LN is only a representation of a bitcoin, not the real bitcoin , as such code changes can easily multiply the representation.
Fractional Reserve is just a software update away.

Your belief that you control your funds is naive.
Broadcast an old transaction and the LN hub will seize your funds and give it to the counterparty and their is nothing you can do to stop it.
Get DDOS and be unable to broadcast the final transaction and have your counterparty broadcast the previous transaction and steal your funds.
The Fees the hubs take from you , you can't stop the hubs from getting their fees.
Close a channel and immediately use your funds , You can't do it because they are time locked and you do not have full control of your funds.*Until the Time Locks Expire.*

Go ask Franky1 to explain it to you for like the 100th time, he has more patience for stupid people than I do.  

You assume that transactions would be priced like that. But how much are the Lightning nodes charging for fees right now? I believe lower than $0.01.

This is why this service is possible in the Lightning Network, https://satoshis.place/

Plus Lightning nodes compete for fees. If they want payments to be routed through them they should set a lower fee than average.

"Lightning Network is Banking 2.0" is nothing but propagnda. There is no fractional reserve in Lightning, and only the user controls his funds.