Author: ZmnSCPxj 2022-06-05 14:29:28
Published on: 2022-06-05T14:29:28+00:00
Recently, Rene Pickhardt presented a work-in-progress concept called "Price of Anarchy", which is similar to the cost of decentralization of Bitcoin and the cost of the Tragedy of the Commons. The Braess Paradox states that adding more roads can cause more traffic, which means that it may actually be better to have a centralized authority that assigns who can be a forwarding server because that worked so great with the Web. Fee setting as flow control is another concept presented by Rene Pickhardt. Every channel is a marketplace where the sats inside the channel are being sold.The strategy of setting fees based on the balance is expected to become a dominant strategy for forwarding nodes in the Lightning Network. The leakage of balance information through feerates creates privacy concerns, so some fuzzing and mitigations can be implemented to reduce the privacy leakage. The Lightning Network community is exploring various alternate strategies for fee-setting and improving gossip rates. One suggestion is to factor in the "fee budget" as the "cost of payment failure," which allows lower-success parts of the feerate card to be selected by rebalancer bots with low fee budgets, while actual payers with higher fee budgets tend to select higher-success entries of the feerate card.The Lightning Network has a problem where the network's liquidity is not balanced, causing nodes to become either a "sink" or a "source". To address this issue, it is proposed that all published nodes support onchain/offchain swap capability. Furthermore, the proposal improves the Price of Anarchy by reducing the economic rent imposed on all payers by the @zerofeerouting strategy. However, multiple people paying to the same node may worsen the effective Price of Anarchy. The article discusses the economic rationality of overcharging in Bitcoin's Lightning Network. The author argues that the overcharge strategy may not be a dominant long-term solution, but it can work effectively on a network where most people set their feerates irrationally. Another node operator shares his thoughts on the topic, agreeing with the idea of the fee-based balance leaking strategy. The author suggests that clboss fee adjuster could operate within the provided range, allowing operators to define the desired strategy and let the market win. In conclusion, the Lightning Network can be seen as an aggregation layer for ultimately onchain payments, and the proposal is intended to improve the efficiency of the network's liquidity.
Updated on: 2023-06-03T08:52:13.166920+00:00