Author: Anthony Towns 2015-09-25 10:11:40
Published on: 2015-09-25T10:11:40+00:00
The Lightning Network is a protocol layer built on top of Bitcoin that aims to solve scalability issues and allow for instant, high-volume micropayments. It involves nodes doing payment forwarding while wallets just spend/receive. However, being a node requires constant activity, tracking beacons, updating routes, etc., which can burn battery and introduce latency. There is also a risk of funds being tied up in active HTLCs when one wants to make a small purchase like buying coffee. There are concerns about privacy as it is easy to tell which of your neighbors is using lightning primarily as a wallet versus trying to be a profit-generating node. Hosted wallets or SPV clients can be used, but the "give me a cheap route" question remains the same whatever one's role. If someone is making money running a node, they can serve around 100k users. However, with only 8 billion potential customers and economics enforcing limits, there is a limit on the number of nodes that can actually do that.In a discussion between Rusty Russell and others on a mailing list, the focus was on the details of the Lightning Network, specifically the beacon nodes. They discussed how many beacon nodes were needed, how long it takes for a beacon node to become active, and how hackers could exploit the system. They also proposed using nanopayments to probe routes to determine fees. Finally, the conversation ended with the idea of using best-effort Distributed Hash Tables (DHT) to route to donation addresses.
Updated on: 2023-05-18T15:18:57.459797+00:00