Topic: The Lightning Network FAQ - page 16. (Read 33426 times)

Sorry, that was an incomplete thought that I typed.
I *know* at least one person tried to open one and could not. Did not know if there were others.
He did not remember the error but did mention in passing that it failed.

Was wondering if it was just him or if others also could not.

-Dave

c-lightning v0.11.0 has been released. Node operators are now able to open multiple channels with the same peer! c-lightning has finally caught up to LND in this matter. It's a good middle ground before splicing (modifying the size of an existing channel) becomes available.

A greater number of peers than the number of channels does not imply that someone tried or wanted to open a channel with you. Nodes randomly connect to other people to exchange the gossip information.

yeah, that's a pretty reasonable set of arguments, essentially a paraphrased "Sam Colt" argument (i.e. "god made man, and TCP/IP made him equal") and is difficult to argue with ultimately.

I still think that some attempt will be made, and perhaps it would involve actually attacking at the level of TCP/IP itself i.e. banks/warlords/govs/moms & dads lobby to replace TCP/IP with something 'safe' for all the poor lost little lambs to play their Facebook games on. That could be the biggest coup d'etat of all time, and I wouldn't put it past them.

Of course, TCP/IP (and reams of equipment and software that still runs it) would still exist. So success would be unlikely outside of total world war scenarios. Sounds like an extraordinary gamble, but well, you never know.

I'm pretty sure there's plenty of sectors where economics of scale have greater importance than favourable regulation, though admittedly that might only apply to sectors that are too small for corporate lobbyists to bother.

That being said, I agree with your assessment in principle, but I don't see how this would apply to LN in practice.

While it's relatively easy to regulate exchanges; tricky, but still possible to regulate mining to a degree, it would be imho impossible to regulate LN nodes in a meaningful way. They're just too easy to spin up and keep running in a nearly untraceable manner. And the capital requirements are close to zero since the main asset required -- ie. Bitcoin -- can be easily redeployed without deprecation. Transaction fees for opening and closing channels notwithstanding. The same can't be said for mining hardware or even the code that exchanges are running on.

The way I see it LN nodes are simply decoupled enough from the classical economy as to be impacted by regulation (short of shutting down the internet). They are decoupled from the fiat system and have only negligible infrastructure requirements causing them to be effectively decoupled from physical locations as well. The first mainly affects exchanges, the latter miners. Both apply to pretty much every traditional business venture. One outlier I can think of are online Casinos that only run on cryptocurrencies. But while these are similarily decoupled from the fiat system and physical requirements, they require much more effort to run smoothly and more importantly they require trust, which for routing payments via the Lightning Network is irrelevant.

I might be missing something but the way I see it Lightning Node operators are in a unique position. Except, of course, there's only limited money to be made.

right, that was what I meant.

I'm surprised at your incredulity, doesn't almost every commercial activity have taxes/regulation structures that favor the largest businesses? And don't the largest business simply pay any onerous costs of business, then leverage the tax system in (sometimes unrelated) ways to claim it all back?

Some large companies claim so much tax back that they end up getting a net negative tax bill, i.e. the government is paying them to stay in business (and that's before counting any explicit subsidies)

I generally agree, but in the case of Lightning Network the question is what vector they'd have to attempt (2)? Given the low entry barrier and open nature of the protocol it seems to be close to impossible for major operators to create any sort of moat. There is an advantage to size as this makes a node both more attractive for routing payments and to open a channel to (given the node properly manages channel liquidity) but it's not something that would prevent a hobbyist node operator from growing themselves.

The only thing I could think of would be an attempt to lobby for legal regulation of Lightning Nodes, but that would hurt large operators more than small ones, as the first would only increase their overhead while trying to prosecute the latter would prove pretty much futile.

I don't tend to believe that node operators will be that nefarious as you posted. I believe it will simply be natural economics. If demand for Lightning transactions increase, naturally if the supply is both limited and valuable, fees to send transactions through those payment channels will increase.

i.e. any profit margin is always thin in a free and open market

the typical behavior of large operators is to:

1. be unhappy
2. find a way to increase the fixed costs of business for everyone in the market, to drive the smaller operators out
3. find a way to (softly) get customers to accept higher prices (trying to manipulate how they think is quite usual)


so we can expect that to happen with Lightning node operators at some point, at least some kind of attempt at it

Thanks guys for bringing this thread back on-topic! So, in my book, competition for fees (which I agree is coming) will drive them down instead of up. This means altruistic node operators will always retain the advantage of being cheaper and it will be hard for 'big centralized players' to 'take over the network' or something. Because to seriously challenge the altruistic channel network, they would need to lock up hundreds or thousands of their own BTC in channels and operate altruistically / at a loss (opportunity cost) as well; otherwise nobody would use their routes. Meanwhile a decentralized network of altruistic operators which all only lock up smaller amounts is more realistic and sustainable.

I'm not trying to disrespect you, JayJuan, but that's just another long-winded post that didn't address the point, or try to get everything back in context.

Going back to the point of incentives/incentive-structures making everything stick together, it will also apply with the Lightning Network. Boot-strapping phase is currently altruistic but as more and more users enter expecting better/more reliable routes, I have debated that more specialized, more efficient routing nodes will be competing against each other for fees.

I understand that you are responding to both of us, and surely BlackHatCoiner can speak for himself - nonetheless, I doubt that either of us are being unfair to you.

Personally, I have no problem accepting that shitcoin pumpening happens and is likely an inevitable phenomenon - but the mere fact that it happens and is likely inevitable neither means that it is necessary nor does it mean that any of us need to talk endearingly about it.. or even to frame the matter as if shitcoins were equal to bitcoin or that they bitcoin needs them in order to strive or survive - which seems to be your ongoing presumption in your ongoing striving to supposedly speak truths, Wind_FURY.

You can write about these matters however you like, but you seem to be bringing backlash upon yourself - because you seem to either ongoingly be engaging in shitcoin pumpening or just unnecessary shit stirring out of your supposed "more accurate" view of matters.  You do what you like, but there are likely several bitcoiners, including yours truly who will respond from time to time - because we are in a public forum and some of us just have difficulties letting such ongoing sloppy presentations to slide and likely cause more confusion that may well even mislead some folks - especially newbies.

Sers, don't take what I said out of context. Because if you truly were trying to understand what I said in "the whole network is literally living off incentivization", you would realize that it's true. From top to bottom, from the miners to the memers.

Altruism WAS necessary to bootstrap the network, incentivization IS necessary for the network to continue chugging along.

Well, saying that the price will go the moon resembles to this behavior.

This is irrelevant and it's also a hasty generalization; just because there's incentive to secure it, doesn't mean you're encouraged to keep it and dump it later in a higher price, because that's how "to the moon" sounds like.

There's development to make it more utilizable. It happens to attract investors. If the opposite occurred, it'd probably be another fraudulent, ponzi-looking situation.

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That's just my opinion, by the way. I don't want to seem absolute nor am I holding the holy chalice of truth. This is just the way I perceive things.

You have been involved in this forum long enough Wind_FURY to be able to attempt to appreciate that a lot of the bitcoiner members appreciate that members post in a way that recognizes the reality that bitcoin is both king daddy, and there is not some kind of equivalencies going on regarding what various shitcoins are doing.  If you fail to frame matters in that kind of way, then you are opening yourself up to attack, whether you are doing it on purpose or not... Maybe you really believe there is no difference between incentives in shitcoins versus various ongoing developments in bitcoin second and third layers, whether we are referring to lightning network or some other 2nd/3rd layer developments?

It seems to me that we can still acknowledge that some value might come from various shitcoin projects - in terms of potential learning about technical or implementation angles that bitcoin could take in the future (or even improve in various current development attempts) - whether referring to base layer or various kinds of second and third layers. 

Seems to me that if you strive to just gloss over bitcoin differentiations - and to seem to want to pump various kinds of shitcoins as if they were equivalent to bitcoin in some kind of way or to even suggest that they are working off of the same incentives when foundationally, there are so many shitcoins that printed their own token, instead of working off of bitcoin - which thereby causes them to have lesser incentives because they have created money/making and money printing incentives for themselves on various kinds of projects that might even have some parallels in bitcoin.. but coming way earlier than bitcoin - and causing all kinds of seemingly premature pump and dump smoke and mirror nonsense going on all over the place with various shitcoins - even if you want to outline the various incentives in shitcoinlandia as if they were all the same - and equivalent to the incentives that are designed in bitcoin (if we can at least attempt to acknowledge that there is a certain amount of attempts in bitcoin to peg projects back to bitcoin's base layer and mostly acknowledge the extent to which some separate token (or business centralizations) might exist on bitcoin layer 2s and 3s that are ongoingly being developed. 

Am I making it look like Ether-scum? I was merely saying that Taro might attract developers from other projects, and start actually building on top of Bitcoin, which might also attract more liquidity for the network, then naturally more investors. Does that make it look like Ether-scum for you?


Ser, the whole network is literally living off incentivization. How do you think it's all sticking together for this long?

any innovations have always tended to be designed in pursuit of Bitcoin's core value proposition: trustless money network. perhaps we could say there is an inbuilt marketplace assumption that cryptocurrencies will always upgrade their capabilities, but that those changes only strengthen a concept that is still the same as it always was. And that the value of the core concept is what is being traded, not the minor buttressing of it's upgrades.

maybe Lightning itself could prove to be the exception to the above, which implies Lightning hasn't achieved sufficient network-effect to affect the Bitcoin market. It was said early on in Lightning's development (~2017-19) that significant use of Lightning would put a visible cap on supply to the marketplace (as the BTC quantity in channels could be easily discerned by checking for them in the UTXO set), although the appearance of Taproot and more exchanges on the network all occurred faster than Lightning gained any significant liquidity. I would still expect any explosion in Lightning usage/liquidity to coincide with an explosion in Bitcoin's market price.

And which is never the cause of price fluctuations. Lightning, SegWit, Taproot, Omni, Liquid, Dandelion, CoinJoin, CoinSwap, DEX and an endless list of other innovations in Bitcoin have never proved to affect the market. The price clearly moves arbitrarily, usually when an Elon appears and empties the exchanges' liquidity.

Wind Fury, enjoy the profit, HODL, have some diamond hands, whatever, you're allowed to say and do whatever you want. But, please, don't make it look like the Ether-scum where they can't look forward for upgrades and 2.0 gibberish to see green candles.

It's just that I want improvements in Bitcoin simply for the sake of having a better payment system and not for the sake of making some investor bags of money. Sure, the value of Bitcoin is that it's such a good payment system, so that's part of the reason it has a high price. But this shouldn't be the main motivation for innovation. That's why a statement like 'this new technology will get btc to the moon' generally rubs me the wrong way.

Ser, I would be lying if I said that I didn't care about Bitcoin's price. I did buy and HODL them as an investment first and foremost. Didn't anyone?

Plus what's with that tone? Why does it look like that you are always trying to make me look bad? I never had any interactions with you in the forum, nor have I insulted you.


I was merely suggesting Taro from a technological perspective, without the drama. Will it improve Bitcoin to be more than what it is today? Will it help onboard more users from other cryptocurrencies, from Ethereum perhaps? Will it be the next narrative during the next bull cycle? It was simply a shower-thought.