Good thread. Basically, only settlements are done on-chain.
You can have a LN channel open for a year and have millions of transactions happen there. Only the final tally will end up on-chain.
Topic: The Lightning Network for Beginners.. (Read 1827 times)
3rd party doesn't control your funds - true. However, you get to pay this 3rd party tax for doing transactions on 'their' network. who could be so stupid to want to let these guys take over the 'protocol'? Hopefully, - nobody.
With the LN protocol there is no 3rd party involved. You and I can create a channel/room. With this channel we do as many transactions as we want. If we are finished we close the channel. No 3rd party involved and no tax to pay. We use bitcoin to establish the channel and to do the clearing when we close the channel.
BTW we can do off-chain transactions right now, using a payment channel.
If you can't add it within the protocol of bitcoin, don't bother.
LN basically means using the the bitcoin protocol elements to create safe off-chain transactions.
It removes the reason why bitcoin was created and used in the first place.
Wrong. It needs the bitcoin system. In fact it is a certain use model of the bitcoin system like multisig escrow.
With TLN you will require trust and other risks inherent with centralized services.
There is no central service. Maybe you should read about how payment channels and lightning network is working first.
I think having TLN is a bad idea.
If you can't add it within the protocol of bitcoin, don't bother.
It removes the reason why bitcoin was created and used in the first place.
With TLN you will require trust and other risks inherent with centralized services.
If you can't add it within the protocol of bitcoin, don't bother.
It removes the reason why bitcoin was created and used in the first place.
With TLN you will require trust and other risks inherent with centralized services.
A protocol owned, managed and controlled by a private well funded entity who intends to charge for its use. Calling it 'a protocol' is just bullshit. It is a massive play to take control of the cryptocurrency ecosystem. Fuck Lightning, and fuck Blockstream. 'it's just a protocol'. lolololololololololol
3rd party doesn't control your funds - true. However, you get to pay this 3rd party tax for doing transactions on 'their' network. who could be so stupid to want to let these guys take over the 'protocol'? Hopefully, - nobody.
What are you talking about? You should educate yourself first, else you just end up looking like a shill and/or troll. Exactly how is it owned by Blockstream? There is no such information. You must be talking about sidechains, which are completely different. There is no protocol at the current stage, only the paper and some early development. Thus your argument is invalid with 'owned, managed, controlled'. If people like Hearn actually wanted Bitcoin to succeed and had skills, they'd code this protocol themselves. 
When you enter into an LN agreement with someone, it is done peer-2-peer. You don't need a 3rd party for anything. And if you do use one, they won't have access to your funds.
3rd party doesn't control your funds - true. However, you get to pay this 3rd party tax for doing transactions on 'their' network. who could be so stupid to want to let these guys take over the 'protocol'? Hopefully, - nobody. Now do you get it?
'The Lightning Network' is a protocol, not a company.
Ultimately LNs will be run by 3rd party companies who will be responsible for their security so they should be thought of as 3rd party services or alt coins.
Actually I don't think so ?
The LN tech will be integrated into your wallet client. Not the server end.
When you enter into an LN agreement with someone, it is done peer-2-peer. You don't need a 3rd party for anything. And if you do use one, they won't have access to your funds.
What I mean is, that you could do your LN business over email, sending each other signed messages in JSON format, or some such. Those messages will be as secure as any normal btc txn. They just need to be cashed in at some point.
All the clever crypto stuff is done completely by you. Including setting the whole thing up initially. No trust required. No 3rd party required.
Yes, you may need access to a block explorer, if you don't run a full node yourself, but I'm pretty sure the whole point about LN is that it is completely decentralised and trustless.
Is this some sort of idea, or has it already been made by some site? Because it's a cool idea, and I'm wondering if something like yobit (koff koff, -Ve kingdom) would be able to switch, as they take out many withdrawals a day.
Well AFAIK Xapo uses an offchain system for internal transactions, but its completely different. Offchain transactions made by a company are pretty common.
This however is different because - as far as my limited understand of it goes - it removes the need for a trusted party (e.g. the company running the exchange).
Is this some sort of idea, or has it already been made by some site? Because it's a cool idea, and I'm wondering if something like yobit (koff koff, -Ve kingdom) would be able to switch, as they take out many withdrawals a day.
or alt coins.
No. Lightning still transacts Bitcoins, all it's really doing is packaging Bitcoin transactions up in the most space efficient way before they hit the blockchain. 'The Lightning Network' is a protocol, not a company.
I think you have misunderstood. We can all use it.
No need for the use of ''. Still have no direct questions?I think you have misunderstood. We can all use it.
Interestingly some people are refusing (or are unable to) acknowledge the fact that scaling via the block size directly is very inefficient (example (idiotic) counter argument: "just because it's inefficient that doesn't mean that we shouldn't do it").
Ultimately LNs will be run by 3rd party companies who will be responsible for their security so they should be thought of as 3rd party services
Yes. Kind of like VISA and Mastercard, or OKPAY and those types of services.
or alt coins.
No. Lightning still transacts Bitcoins, all it's really doing is packaging Bitcoin transactions up in the most space efficient way before they hit the blockchain.
Ultimately LNs will be run by 3rd party companies who will be responsible for their security so they should be thought of as 3rd party services or alt coins.
I'll start, and then some one, please correct me..
As I understand it, and from other lively discussions, LN (a proprietary network owned by individuals) allows Bitcoin users to go into a private room (if they have permission from LN), transact amongst themselves (others who also have permission from LN) with 100% security (guaranteed by the LN administrators - not cryptography) off the main chain, and then when all is said and done, they leave the room (after having paid significant fees), and post a TXN on the main-chain that is the culmination / sum of all the private TXNs - (actually, they never have to use bitcoin ever again - they can just keep using their closed-loop transactions between other LN members and keep paying their fees. It renders the bitcoin network useless).
Now do you get it?
'The Lightning Network' is a protocol, not a company.
I think you have misunderstood. We can all use it.
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ps you misquoted me..
I'll start, and then some one, please correct me..
As I understand it, and from other lively discussions, LN (a proprietary network owned by individuals) allows Bitcoin users to go into a private room (if they have permission from LN), transact amongst themselves (others who also have permission from LN) with 100% security (guaranteed by the LN administrators - not cryptography) off the main chain, and then when all is said and done, they leave the room (after having paid significant fees), and post a TXN on the main-chain that is the culmination / sum of all the private TXNs - (actually, they never have to use bitcoin ever again - they can just keep using their closed-loop transactions between other LN members and keep paying their fees. It renders the bitcoin network useless).
Now do you get it?
1) Yes - you do need OP_CHECKLOCKTIMEVERIFY for it to work. In fact you need a 'relative' version. This is implemented in Core 0.12 but needs a mining Super Majority to be a 'go-er'. So, can't be used just yet, but should be Ok soon...ish.
Minor correction: 0.11.2 and 0.10.4 will also include the CHECKLOCKVERIFYTIME opcode soft-fork logic, it's not necessary to go straight to 0.12 to support the enabling of Lightning. BIP112 wlll improve matters for operating Lightning also, in support of "Deployable Lightning"....
Rusty Russell just published a new, simplified implementation of Lightning a week or two ago (Deployable Lightning), it reduces the need for (even more) opcodes and also makes it a little more efficient.
Hmm.. more reading.. missed something.
Payment channels are 1 way. LN is bi-directional. BIG difference.
Sooo.. You DO NEED LN for 2 parties if you are going to be paying back AND forth.
With a 2 party one-way channel, like paying at Starbucks, a normal payment channel will do. (no refunds though)
In fact, this makes me wonder whether you would ALWAYS use LN over a normal payment channel ?
Since LN does everything a payment channel does, and more.
Payment channels are 1 way. LN is bi-directional. BIG difference.
Sooo.. You DO NEED LN for 2 parties if you are going to be paying back AND forth.
With a 2 party one-way channel, like paying at Starbucks, a normal payment channel will do. (no refunds though)
In fact, this makes me wonder whether you would ALWAYS use LN over a normal payment channel ?
Since LN does everything a payment channel does, and more.
Annnddd... Back in the Room!.. (Snaps Fingers).. 
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Went and scoured the 'info-web-net' last night to see if I could come up with anything.
Here it is. (Not much to be fair..
)
1) Yes - you do need OP_CHECKLOCKTIMEVERIFY for it to work. In fact you need a 'relative' version. This is implemented in Core 0.12 but needs a mining Super Majority to be a 'go-er'. So, can't be used just yet, but should be Ok soon...ish.
2) The 2 way payment channel as described here :
is quite straight forward to understand.
What LN does, is it allows you to chain MORE than 2 people together. This was a 'semi-nice' example I found :
In other words, you don't need LN for a 2 party group. A normal payment channel will do. LN is for Multi-Party groups.
3) The messages will need to be sent back and forth over some other network. Obviously you can't do it over the Bitcoin network.. This may lead to payment hubs, where you can meet and 'dance'.
4) Obviously, yet not mentioned much, if the TXN's are taken off the network, this helps with anonymity, as you will be operating off-chain. (Though those you transact with will know.)
As always, anyone who knows, please do correct..
..
Went and scoured the 'info-web-net' last night to see if I could come up with anything.
Here it is. (Not much to be fair..
)1) Yes - you do need OP_CHECKLOCKTIMEVERIFY for it to work. In fact you need a 'relative' version. This is implemented in Core 0.12 but needs a mining Super Majority to be a 'go-er'. So, can't be used just yet, but should be Ok soon...ish.
2) The 2 way payment channel as described here :
is quite straight forward to understand.
What LN does, is it allows you to chain MORE than 2 people together. This was a 'semi-nice' example I found :
Quote
Alice comes across Dave's wallpaper site and wants to buy one for 50 bits. Alice doesn't have a payment channel with Dave and doesn't want to set one up because this is a one off payment. Alice does have an existing channel with Bobpay, though. Bobpay has a channel with Carolbase and Carolbase has a channel with Dave. Alice and Dave can create a set of transactions that chain the channels together so Alice pays Bobpay who pays Carolbase who pays Dave.
In other words, you don't need LN for a 2 party group. A normal payment channel will do. LN is for Multi-Party groups.
3) The messages will need to be sent back and forth over some other network. Obviously you can't do it over the Bitcoin network.. This may lead to payment hubs, where you can meet and 'dance'.
4) Obviously, yet not mentioned much, if the TXN's are taken off the network, this helps with anonymity, as you will be operating off-chain. (Though those you transact with will know.)
As always, anyone who knows, please do correct..
We had such a nice discussion til you came along with your "XT is bad"-bullshit. Do you have to spoil every topic with that? Nobody said a bad word about anybody. There is a world outside your stupid battle against XT.
Kind of ironic, as XT promoters are the literal origin of this exact problem.
Here's an off-topic post for you:
The XT supporters Handbook
1. Insert XT into every thread ad nauseum
2. Complain that everyone except XT supporters are inserting XT into every thread ad nausem!
As usual, you people are total hypocrites. You people started this nonsense, so if you don't like others playing your game the same way you do, you know where to go (hint: you're advertising it in your sig)
This is what it sounds like (to me) when people start talking about side chains and lighting networks. https://www.youtube.com/watch?v=RXJKdh1KZ0w
Okay, I'm really worn out. I have no idea how to approach the thread now (after a few replies). Could you ask direct questions? What is it that you do not understand or have trouble understanding; what are your concerns?
I found the exact words from luke-jr on reddit:
Keep in mind that LN also needs a block size increase in order to scale upwards. However, even if we followed Gavin's plan and did 8 GB right now (I'm disregarding all problems with this statement, and we're going with the assumption that this is the perfect solution) it would be able to handle ~24 000 tps (3 tps at 1 MB x ~8000). This seems like a nice number doesn't it? It does not if you factor in the size of each block. We're talking about ~1 150 GB of data per day (~420 400 GB per year). Obviously this is really inefficient.
Now with the Lightning Network on the other hand:
We had such a nice discussion til you came along with your "XT is bad"-bullshit. Do you have to spoil every topic with that? Nobody said a bad word about anybody. There is a world outside your stupid battle against XT.I found the exact words from luke-jr on reddit:
Quote
Near-instant confirmation for transactions in a trustless manner, much cheaper than the blockchain.
In other words, if some XT shill comes up here, and says that blockstream will profit from this and whatnot put them on the ignore list so that we can have a decent discussion. Keep in mind that LN also needs a block size increase in order to scale upwards. However, even if we followed Gavin's plan and did 8 GB right now (I'm disregarding all problems with this statement, and we're going with the assumption that this is the perfect solution) it would be able to handle ~24 000 tps (3 tps at 1 MB x ~8000). This seems like a nice number doesn't it? It does not if you factor in the size of each block. We're talking about ~1 150 GB of data per day (~420 400 GB per year). Obviously this is really inefficient.
Now with the Lightning Network on the other hand:
Quote
If all Bitcoin transactions were conducted inside a network of micropayment channels, to enable 7 billion people to make two channels per year with unlimited transactions inside the channel, it would require 133 MB blocks (presuming 500 bytes per transaction and 52560 blocks per year).
Your post is completely off-topic. If you want to contribute, answer the question:
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3) You cannot add funds to a room, except for those added at the inception, once the room has been created.
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Are you sure about point 3? After all, it is just a multisig, so why shouldn't you be able to send new funds there?3) You cannot add funds to a room, except for those added at the inception, once the room has been created.
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No - I am not sure..
That's pretty important though, as it changes how much you need to lock up.
Anyone ?
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