Re: Why isn't the Lightning Network being implemented in the Bitcoin protocol?
I'm fairly new to this discussion board so please pardon me if my question seems to be quite trivial.
I was wondering why the lightning network hasn't been launched yet?
I understand the SegWit needs to be activated first and miners are essentially centralizing their power for their own interests but for the whole Bitcoin ecosystem, the LN speeds up confirmation times, enables the transfer of really small values and streamlines the process of transferring BTC within the Bitcoin network.
Although there are drawbacks to this extension, I think that the pros outweigh the cons and it should be launched as soon as possible. The politics behind this debate does not contribute anything to the ecosystem and something needs to be done in order for Bitcoin to be a sustainable method of payment in the future.
So can anyone help me understand what's stopping this from happening? In my opinion, I think this is the future of the Bitcoin network and it would be a shame if consensus cannot be reached regarding this topic.
Please discuss.
I was wondering why the lightning network hasn't been launched yet?
I understand the SegWit needs to be activated first and miners are essentially centralizing their power for their own interests but for the whole Bitcoin ecosystem, the LN speeds up confirmation times, enables the transfer of really small values and streamlines the process of transferring BTC within the Bitcoin network.
Although there are drawbacks to this extension, I think that the pros outweigh the cons and it should be launched as soon as possible. The politics behind this debate does not contribute anything to the ecosystem and something needs to be done in order for Bitcoin to be a sustainable method of payment in the future.
So can anyone help me understand what's stopping this from happening? In my opinion, I think this is the future of the Bitcoin network and it would be a shame if consensus cannot be reached regarding this topic.
Please discuss.
Miners are stopping it, because it will decrease their transaction fees earnings and allow LN to monopolize the transactions fee completely off chain and bankrupt the miners, who depend on ONCHAIN transaction fees. Currently ~$1000 per block.
We already went over this stuff in the forums.
Segwit allow cross blockchain atomic swaps, so trading without trusting your coins to exchange possible. SegWit allow off chain transactions, so private transactions without coinmixers possible. SegWit allow instant transactions and allow more transactions per second. No matter how good or bad today implementation is, SegWit is a step in the right way. Network should progress, anonymity matters, big tps and instant transactions is a must. Once litecoin adopts segwit all shitcoins become obsolete, so no wonder miners trying to derail voting and spread FUD here and there.
You are confusing Segwit with LN,
Segwit only allows the TIME LOCKING of BTC onchain.
LN does a counterfeit offchain transactions, because if those time locks fail, you are trading fake coins.
Which you only learn it is fake, if you try cashing out on the TRUE ONLINE CHAIN.
Well, SegWit allow Lightning Networks. Without SegWit LN probably will not happen. And what does it mean IF those time locks fail? Why should time locks fail, because of what? If you think there can be problem with it - please show it on test network.
If bitcoin splits on two hundred altcoins, if artificial intelligence robots attack us, if government builds quantum supercomputer to hack dogecoin there definitely will be some problems with cashing out too. That's very unlikely, though.
Test Net is unnecessary just read the LN whitepaper.
Here is the Short version.
So what secures the LN network then?
Description : From Bitcoin Wiki.
Lightning Network is a proposed implementation of Hashed Timelock Contracts (HTLCs) with bi-directional payment channels which allows payments to be securely routed across multiple peer-to-peer payment channels.Dec 22, 2016
Segwit supporters say :
It relies on the underlying blockchain, be it Bitcoins or otherwise, for its security.
In the case of Bitcoin, it uses the underlying proof-of-work algorithm that secures the entire network to secure
But I will tell you the truth, LN Security Relies only on : proposed implementation of Hashed Timelock Contracts (HTLCs)
Time Locks are what you are relying on for Security in LN.
Examples: When the Time Locks expire your BTC can be stolen
My fear with LN is rather the opposite: that propagating "waves of panic" will overwhelm the block chain with transactions, because the amount of transactions pending on the LN network can in principle be orders of magnitude larger than what a block chain can handle (that's its main idea !). So if a block chain can handle, say, 100 000 transactions per hour, and the LN network has 10 million transactions pending in 10 minutes, and there's a panic wave going through the network, those 10 million transactions will need to go on-chain which will create a backlog of 100 hours, often passing the safety time limit of regularisation, and huge opportunities to scam.
Your fears are confirmed , article from Jul 5, 201612:28 PM EST by Kyle Torpey
https://bitcoinmagazine.com/articles/here-s-how-bitcoin-s-lightning-network-could-fail-1467736127/
And also what would happen in this scenario if the locks on the main chain expire before the tx from LN can be pushed back to the main chain, it would be a bit like double spending issue no ?
@IadixDev,
Nice, you see the problems with LN also.
How to Steal LN Funds from the LN WhitePaper itself.
Quote
https://lightning.network/lightning-network-paper.pdf
Page 49 thru 51
Page 49 thru 51
Quote
Improper Timelocks
Participants must choose timelocks with sucient amounts of time. If insuf-
cient time is given, it is possible that timelocked transactions believed to
be invalid will become valid, enabling coin theft by the counterparty. There
is a trade-o between longer timelocks and the time-value of money. When
writing wallet and Lightning Network application software, it is necessary
to ensure that sucient time is given and users are able to have their trans-
actions enter into the blockchain when interacting with non-cooperative or
malicious channel counterparties
Participants must choose timelocks with sucient amounts of time. If insuf-
cient time is given, it is possible that timelocked transactions believed to
be invalid will become valid, enabling coin theft by the counterparty. There
is a trade-o between longer timelocks and the time-value of money. When
writing wallet and Lightning Network application software, it is necessary
to ensure that sucient time is given and users are able to have their trans-
actions enter into the blockchain when interacting with non-cooperative or
malicious channel counterparties
Quote
9.2 Forced Expiration Spam
Forced expiration of many transactions may be the greatest systemic risk
when using the Lightning Network. If a malicious participant creates many
channels and forces them all to expire at once, these may overwhelm block
data capacity, forcing expiration and broadcast to the blockchain. The re-
sult would be mass spam on the bitcoin network. The spam may delay
transactions to the point where other locktimed transactions become valid
Forced expiration of many transactions may be the greatest systemic risk
when using the Lightning Network. If a malicious participant creates many
channels and forces them all to expire at once, these may overwhelm block
data capacity, forcing expiration and broadcast to the blockchain. The re-
sult would be mass spam on the bitcoin network. The spam may delay
transactions to the point where other locktimed transactions become valid
Quote
9.3 Coin Theft via Cracking
As parties must be online and using private keys to sign, there is a possibility
that, if the computer where the private keys are stored is compromised, coins
will be stolen by the attacker. While there may be methods to mitigate
the threat for the sender and the receiver, the intermediary nodes must be
online and will likely be processing the transaction automatically. For this
reason, the intermediary nodes will be at risk and should not be holding
a substantial amount of money in this \hot wallet." Intermediary nodes
which have better security will likely be able to out-compete others in the
long run and be able to conduct greater transaction volume due to lower
fees. Historically, one of the largest component of fees and interest in the
nancial system are from various forms of counterparty risk { in Bitcoin it
is possible that the largest component in fees will be derived from security
risk premiums.
A Funding Transaction may have multiple outputs with multiple Com-
mitment Transactions, with the Funding Transaction key and some Commit-
ment Transactions keys stored oine. It is possible to create an equivalent
of a \Checking Account" and \Savings Account" by moving funds between
outputs from a Funding Transaction, with the \Savings Account" stored
oine and requiring additional signatures from security services.
As parties must be online and using private keys to sign, there is a possibility
that, if the computer where the private keys are stored is compromised, coins
will be stolen by the attacker. While there may be methods to mitigate
the threat for the sender and the receiver, the intermediary nodes must be
online and will likely be processing the transaction automatically. For this
reason, the intermediary nodes will be at risk and should not be holding
a substantial amount of money in this \hot wallet." Intermediary nodes
which have better security will likely be able to out-compete others in the
long run and be able to conduct greater transaction volume due to lower
fees. Historically, one of the largest component of fees and interest in the
nancial system are from various forms of counterparty risk { in Bitcoin it
is possible that the largest component in fees will be derived from security
risk premiums.
A Funding Transaction may have multiple outputs with multiple Com-
mitment Transactions, with the Funding Transaction key and some Commit-
ment Transactions keys stored oine. It is possible to create an equivalent
of a \Checking Account" and \Savings Account" by moving funds between
outputs from a Funding Transaction, with the \Savings Account" stored
oine and requiring additional signatures from security services.