Topic: The Lightning Network FAQ (Read 33222 times)

The layer of privacy like what "anon" mentioned is probably the actual reason, no?

If that's true, then that's actually good to know. Because if, "lightning breaks chainanalysis", then they either force the users to abandon the Lightning Network, but if they can't do that, they hire a service to follow transactions or monitor the network themselves WHICH will require them to buy Bitcoin and open channels - Therefore provide liquidity in Lightning.

¯\_(ツ)_/¯

After reading whole stacker.news page and reading some mentioned link, i would speculate it's related with 2 new services/company used by Kraken.

Kraken employee Marc McKirahan has posted on X that the reasons for the Lightning removal in Germany were technical in nature. He however didn't confirm a date when it will be re-enabled.

There seem to be other services like Strike (according to the answers on Stackernews) which offer the Lightning option in Germany without problems.

European regulations (MiCa) at this moment do not require exchanges to delist Monero or Lightning. This could however change in 2027 due the AMLD6 regulation which forbids services similar to mixers and also mentions "anonymity-enhancing coins", which is however still not completely approved afaik.

The beatings will continue until morale improves. Centralized exchanges are what the name says; not a sign of adoption. Monero, for example, is delisted on many exchanges, but is quite adopted on the Internet.

Monero is only allowed to be withdrawn from your Kraken account if you're German, as of September 10th: https://support.kraken.com/hc/en-us/articles/asset-support-for-german-clients. If you cannot surveil your citizens, how can you protect them?

I'd like to know that too. I'd expect local laws in my country to be close to German laws, so this surprises me. Especially since Kraken still allows Monero trading (although I don't know if they made an exception for Germany).

What compliance regulations are they talking about here? I couldn't find any links. And "germany compliance lightning network" doesn't return any relevant hits on search engines either.

Surprise, surprise...Kraken exchange  drops Lightning Network in Germany due to compliance reasons.
I am sure all Lightning wallets will be next on the list, probably Phoenix wallet is the first to go.
Lightning is the fUtuRe, adopti0n c0ntinues 
https://stacker.news/items/681879

That's actually the question I wanted to be answered. OK, then the developers should have it implemented for the Lightning node/client/software before it can make multi-sig transactions look the same as the normal transactions. 🤔

Does anyone know if that upgrade is already being discussed in their forums/developer's mailing lists? I believe it's going to be the most important upgrade for Lightning, that will also add more benefit to Bitcoin on-chain transactions - a layer of privacy.

Your Lightning node software should handle this, in most cases that's LND or c-Lightning. Don't ask me if both Lightning node softwares do actually have implemented it already. I'm lagging behind current feature status of both. If you do it on the command line or use some fancy interface like Ride The Lighning or similar, all of those "interfaces" talk to LND or c-Lightning to create channels, close them or submit transactions and more.

That's the upgrade! Lightning payment channels utilize 2-of-2 multisig addresses. Does having the feature of making them look like regular Bitcoin transactions require an upgrade in Lightning too? Or does that happen automatically of it's already available on-chain? 🤔

It's Taproot with Schnorr signatures that allows multisig transaction to appear like normal ones. I still fall short to understand Taproot/Tapscript/Schnorr stuff in detail as so far I barely had to interact with it. Excuse my ignorance but I can't even tell if any of the common Lightning nodes have implemented this magic.

Maybe have a look here: https://medium.com/interdax/what-is-taproot-and-how-will-it-benefit-bitcoin-5c8944eed8da

I closed my few LN channels quite some time ago. For my use cases too much hassle to maintain liquidity and channel balances. Phoenix wallet suits me more, totally personal experience, opinion and use case.

What's that upgrade that would make the transactions for opening/closing Lightning channels indistinct from regular Bitcoin on-chain transactions? Was that Taproot/Schnorr multi-signatures? What's its current state of usage in the Lightning Network?

I believe the developers should have something implemented as soon as possible before the government notices the layer of privacy Lightning gives for its users.

Aren't most of the transactions that happens in the Dark Markets are from retail buyers? LN probably could handle $500.00 Dollar transactions maximum for thousands and thousands of users, no?


They currently don't care, but if someone built a TOR plugin with better UX like what Casey envisions that's safe, secure, and private enough, I believe they will start to care.


 

To answer maxibitcat - because monero is a shitcoin.

Macro, actually, with payments from several hundred to several thousands of dollars. Lightning Network is not designed to handle such a thing. Also channel creation continues to be a pain in the ass.

Besides, dark markets are intentionally designed without Javascript support for security reasons. I don't think they care about UX at all. In fact, I think all the complaints that Rodarmor mentioned are actually good things.

I share the same opinion as @maxibitcat:

Another thing is micro-payments. I'd bet that darknet market transactions aren't... "micro".

Casey Rodarmor suggests an Open Source dedicated Dark Market app/TOR plugin with a better UX and to utilize the Lightning Network.


What's everyone's opinion about Casey Rodarmor's idea? Because it's going to be Open Source, the Dark Markets will be standardized and less susceptible to exploits and backdoors.

I can't say that's worse than millions of people who now keep "their" Bitcoins on exchanges, or exchanges that make up their own "wrapped" Bitcoins.
I'm okay with custodial usage for low amounts, as long as it's widely accepted. A bigger problem may be if we get different sidechains from different providers.

It would not be that easy as setting up a Lightning node, because the problem of Statechains (and the reason why I'm not really interested in that concept) is that the operator is an entity which can steal coins with no possibility for the user to penalize him and claim his coins back. This needs some conditions to be fulfilled, basically the Statechain operator has to be able to become an user of one of his own Statechains to steal the funds, but in an anonymous/pseudonymous setting this probably isn't that difficult.

Thus as a statechain operator you must gain trust in a much more pronounced way than as a Lighting node operator. As far as I interpreted the article from Bitcoin Magazine linked above, mercury channels don't change that, because the private key shared between statechain operator and user does not change, it only is "reconfigured" when the user transfers the "statechain coins". Mercury channels "blinding" can however make it more difficult for the Statechain operator to "chase" the users of his own statechain to eventually receive the coins themselves, as they have less knowledge about their activity.

But the primary attack I see is: The statechain operator opens a statechain with itself and then tries to exchange these coins to another user, and once the other user has fullfilled his part of the exchange (e.g. delivered an altcoin, a good/service, fiat etc.) he steals the coins as he has always access to the whole private key.

The "statechain operators" thus - as acknowledged by the creator of the original whitepaper - will be thus mostly federations, like in Liquid, and thus for individuals without recognition and trust in the crypto space it will be very difficult to become part of one of these operators.

Quoted from the same article,


I believe operating as a "state-chain facilitator" to make some profit in fees will pay more than operating a Lighting node because the UTXOs/liquidity in the system is pooled within hubs which users can transfer freely with other users who probably are connected to the same pool or to another high liquidity pool?