⭐ Merited by DooMAD (2)
Also one of the LN dev proposals even admits it can be a fractional reserve.
https://www.rene-pickhardt.de/index.html%3Fp=2131.html
Most clueless LN fanatics like to say LN is still in beta,
well by the time they finally do claim to be out of beta,
it will be a fully functional undeniable fractional reserve system, ie crypo banking 2.0
which has been the intention since day one.
Because if you truly look at LN , it becomes apparent it will not fix the scaling issues,
unless LN Banks form and do the majority of the offchain transactions, and banks always create a fractional reserve scam.
https://www.rene-pickhardt.de/index.html%3Fp=2131.html
Quote
I suggest to add another feature to the lightning network which I call a virtual payment channel (or in short VPC) to be described in this article.
Such a virtual payment channel will NOT be backed by the blockchain and thus cannot operate in a trustless manner
Such a virtual payment channel will NOT be backed by the blockchain and thus cannot operate in a trustless manner
Quote
The main one is that to some degree VPCs resembles the fractional reserve banking system
Most clueless LN fanatics like to say LN is still in beta,
well by the time they finally do claim to be out of beta,
it will be a fully functional undeniable fractional reserve system, ie crypo banking 2.0
which has been the intention since day one.
Because if you truly look at LN , it becomes apparent it will not fix the scaling issues,
unless LN Banks form and do the majority of the offchain transactions, and banks always create a fractional reserve scam.
You're quoting a draft from July 2018 for a proposal that never came to be. Seems like the whole point of your thread is simply to FUD Lightning. Nobody has any plans to create these Virtual Payment Channels. You didn't even quote the entirety of the quote:
Quote
While writing down the article I realized there are also some dangers to virtual payment channels. The main one is that to some degree VPCs resembles the fractional reserve banking system even though it is still only credit based on positive money (I think the English language should borrow the German word Vollgeld-System). At first I considered dropping the article because the last thing that we need is a cryptocurrency crises similar to the banking crisis that we have been through. However I think when regulated and used properly VPCs will add more benefit than danger to the lightning network. Despite the drawbacks with this article I will still propose this feature.
It was a proposal. Nothing ever came of it. To equate that with there currently being fractional reserve banking in Lightning is low-level deception. What is the point of all this "but what if" conjecturing? What if a critical bug is discovered in the Bitcoin Core code tomorrow? What if the earth gets smashed by a comet? These are also both real concerns we need to be worrying about
