My fear with LN is rather the opposite: that propagating "waves of panic" will overwhelm the block chain with transactions, because the amount of transactions pending on the LN network can in principle be orders of magnitude larger than what a block chain can handle (that's its main idea !). So if a block chain can handle, say, 100 000 transactions per hour, and the LN network has 10 million transactions pending in 10 minutes, and there's a panic wave going through the network, those 10 million transactions will need to go on-chain which will create a backlog of 100 hours, often passing the safety time limit of regularisation, and huge opportunities to scam.
Pending transactions are a problem, but we should have clear scenario when coins lost or stolen, to veto SegWit. Do you have some idea how LN node can run and hide with other people coins? Transactions delay somehow a normal thing today, and people suddenly don't care and keep buying bitcoin, and I don't know why they do it, to be honest.
LN provide some radical potential improvement for scalability, if some problem will be found it will just provide an opportunity to find a way to fix it, as always. Not first time when bitcoin network fucked up and need to be fixed, and not the last time.
Potential progress is a huge network with high speed transactions and huge volume, potential loss - delayed transactions IF something goes wrong. Worth to throw a ball.
When writing wallet and Lightning Network application software, it is necessary
to ensure that sucient time is given and users are able to have their trans-
actions enter into the blockchain when interacting with non-cooperative or
malicious channel counterparties
It can be done, well, when writing wallet and Lightning Network applications. Why not?
9.2 Forced Expiration Spam
Forced expiration of many transactions may be the greatest systemic risk
when using the Lightning Network. If a malicious participant creates many
channels and forces them all to expire at once, these may overwhelm block
data capacity, forcing expiration and broadcast to the blockchain. The re-
sult would be mass spam on the bitcoin network. The spam may delay
transactions to the point where other locktimed transactions become valid
Spam is a problem, but not a critical problem. Right now bitcoin suffer from transaction delays.
Can coins be lost forever?
9.3 Coin Theft via Cracking
As parties must be online and using private keys to sign, there is a possibility
that, if the computer where the private keys are stored is compromised, coins
will be stolen by the attacker. While there may be methods to mitigate
the threat for the sender and the receiver, the intermediary nodes must be
online and will likely be processing the transaction automatically.
Bitcoin transactions are irreversible. And this is the nature of bitcoin. Exchanges can be cracked, coins can be lost, no way to fix it without centralization. Probably some multisig solution can be developed for LN nodes to reduce the risk, or not, I don't care. It's just a normal thing, like risking your coins for online staking in POS coins.
Without LN or similar solution decentralized bitcoin network can't scale. Either we will have some "master nodes" with huge storage to keep block chain with 1gb average block (it's still possible and network will run fine) and SPV wallets for users, or LN.
"low fees"...
