Have you seen the Channels Factories proposal (Whitepaper)? In short, CFs are single channels opened between multiple parties (up to 15 with the current limitations of Bitcoin Core, but afaik many more if Schnorr signatures are implemented). Members of such a group can open sub-channels at no cost to the other members of the group, and transact freely.
That has two advantages:
- first, you have to pay only one transaction fee for all the 15 individuals to open or close the channel. The transaction is bigger, so the transaction fee will also be bigger, but the fee per individual node would be >5 times lower.
- second, you can integrate a well-connected node (a little hub, for example) into the group, to be able to recharge channels that get "out of balance". That would mean that there will be very few necessary on-chain transactions.
So CFs could be an interesting part of the puzzle to avoid the scenario that "only wealthy individuals and businesses" could afford to open channels. Instead, you would open a channel factory with your friends, some merchant(s) you regularly visit and perhaps one exchange to re-charge the channel in an off-chain manner if necessary.
That has two advantages:
- first, you have to pay only one transaction fee for all the 15 individuals to open or close the channel. The transaction is bigger, so the transaction fee will also be bigger, but the fee per individual node would be >5 times lower.
- second, you can integrate a well-connected node (a little hub, for example) into the group, to be able to recharge channels that get "out of balance". That would mean that there will be very few necessary on-chain transactions.
So CFs could be an interesting part of the puzzle to avoid the scenario that "only wealthy individuals and businesses" could afford to open channels. Instead, you would open a channel factory with your friends, some merchant(s) you regularly visit and perhaps one exchange to re-charge the channel in an off-chain manner if necessary.
Interesting. I've never read the whitepaper related to Channel Factories before, but I'm glad that you've shared this information with me. It seems that the LN could be decentralized after all, if Channel Factories achieve said purpose. The good thing about this feature, is that it minimizes on-chain transactions, which prevents the main chain from getting clogged with lots of transactions made from opening/closing channels in the Lightning Network.
Hopefully, the addition of Channel Factories and the use of Watchtowers, would make LN as robust as possible, to help drive Bitcoin's usage to new heights. As long as people don't replace the LN with the main chain, then everything should be fine. Because, imagine if everyone starts using the LN, and never interacts with the main chain. Then, miners might become affected as they won't be earning money from fees in the long run.
Exactly! There will be no mandatory route. Everything is possible. Let's wait and see. I think LN will be an excellent micropayment network, but not necessarily will replace on-chain transactions completely.
I hope so. Because if people start using more the LN than the main chain for any kind of transaction, then miners would be doomed, IMO. But, it seems very unlikely for that to happen since the LN would make transactions on the main chain for opening/closing channels. Therefore, in the end, miners will always get their block reward and fees as usual.
As LN transactions are "private", but regular Bitcoin transactions, they cannot be double-spent easily. I don't know if a large LN channel, however, could incentive a Bitcoin double spend attack.
Well, if LN is as secure as Bitcoin's main chain, then there should be nothing to worry about. After all, opening/closing a channel in the LN, requires an on-chain transaction to be made. As such, the LN would obtain the same level of security as the main chain since it requires the blockchain to settle HTLCs. However, as with any new technology, it needs to be properly tested, for issues to be addressed, making it as resilient as possible against external attacks.
