lightning is fate
Lightning is destiny. Ordinals’ high fees have killed any hope of scaling Bitcoin non-custodially. There is absolutely no possibility for people to cost-effectively open channels or enforce payment interruptions on-chain when needed. It’s all over. Get it all together, guys. Since you can’t afford to do it yourself on-chain in a high fee environment, it’s time to start shopping around and decide whether Coinbase or Cashapp is a better platform for all your Bitcoin needs.
It was fun while it lasted. Lightning art sites will always have pixelated dick pics. The lightning torch meme would still have a quick pout even though the state government was afraid to send it to people in a country where they told us it was full of nothing but bad people. From management account to management account. We are entering the age of walled gardens!
If you take any of that seriously on any level, take a look at your reflection in the mirror and slap yourself hard.
Remove gaslighting smoke
The original Lightning Network whitepaper specifically defined in the document’s conclusion that Bitcoin would need 133MB blocks for 7 billion people to open two channels per year.
The white paper has an entire section called “Risks” (Section 9), which outlines all of the major issues people think Lightning is “ridiculous” for with its high fees. The first section of the paper describes the timelock window. “Improper time lock.” This is essentially the dynamics of commission rate versus confirmation time, which has been a big topic of interest recently. When routing a payment through the network, we define a success path based on a hashlock pre-image and a payback path based on a refund time lock window. Higher fees require longer corresponding time lock periods to ensure that pre-image spending (successful transactions) is not confirmed before the refund transaction becomes available.
This means that if you need to confirm a successful payment on-chain, the time lock on the refund path must be long enough to confirm a successful payment path before the channel counterparty can claim funds through the refund path. The predetermined transaction fees for pre-signed channel closure transactions are so low that they cannot be confirmed as quickly as expected when signed, so the longer that time lock period lasts, the higher the fees.
Many people are frightened and distraught by this dynamic as if it were a new realization and it spells doom for the Lightning Network. This was literally described as a risk in the original white paper specifying the first version of the Lightning Protocol. From an economic perspective, opportunity cost trade-offs were also explicitly explained.There is a trade-off between longer time locks and the time value of money.”
The next section is “Force Expiration Spam”. Describes the general concepts of flood and loot attacks. To take advantage of the fact that double-spend success path transactions can occur if a refund transaction is required, especially if the fees are too high, the attacker opens a large number of channels and closes them on-chain at the same time. It is implemented on-chain. If you have multiple channels open for payments in between, and you close them all at once and the fees get high enough, all channel counterparties that need to confirm successful payments on-chain can find themselves in a double-spending race. If the fees are high enough that a time-locked transaction can become valid before a successful transaction with a pre-image is confirmed.
If enough channels are open and the fees are high enough, this can be profitable. The white paper describes it literally as an architectural problem. Depending on the version of the paper you count, this class of attacks was described in 2015-2016. It wasn’t officially modeled and featured in the news cycle in this space until 2020.
The white paper described penalty keys for data loss, situations where pre-signed closed transactions are lost, and transfer states that can steal funds if a malicious channel counterparty becomes aware of them. This raised the possibility of a situation where penalty transactions could not be broadcast, and the possibility of a third party solving this problem by monitoring the blockchain and submitting such transactions on your behalf. This literally described miners censoring channel penalty transactions as a risk, and proposed anonymity (and implicit decentralization) for miners to mitigate that risk.
However, this is all new information. The Lightning Network is doomed to fail because no one saw these problems coming!!!!
blockchain you are stupid
Well, I guess we can admit that historical context has been lost. The reason is gone. Logic and rationality have been lost. We are in a reality where we are trying to pretend that historical warnings do not exist, no one has pointed out any obvious problems that will appear in the future, and this is all completely uncharted territory where no one has thought about how things will turn out. play.
What is the title of section 9.6? Oh: The required soft fork cannot be created.
The original whitepaper explicitly described the inability to orchestrate a soft fork as a risk to the success of the Lightning Network. Are you surprised? Never read this before? Personally, I feel a sense of déjà vu.
I remember many Bitcoin users screaming many years ago that the blockchain itself was reaching its scaling limits and that it would fail unless the entire nature of the decentralized balance of the system was fundamentally changed. A blockchain is fundamentally useless if people can’t submit and cost-effectively verify every transaction directly on-chain.
When people started arguing about the cost-effectiveness of blockchain at scale, the entire foundation of the Bitcoin ecosystem was shaken to its core, which was literally the entire cause of the block size wars. What was the point of this confusion? People’s expectations about what role blockchain will play in the evolving mystery of the Bitcoin ecosystem. Everyone will buy coffee on-chain with cost-effective fees. Otherwise Bitcoin will fail completely.
Anyone with that mindset has just completely misjudged the whole situation. They tried to fill the round hole with a square peg. The same goes for Lightning.
square peg, round hole
Blockchain is very misguided. In reality, it was not a place to buy coffee, but just a place to open and close channels. There is absolutely no way people would misjudge Lightning. Lightning is definitely the place to go for coffee payments. This time no one could have faulted it. Do you see how stupid it sounds to say that in the right context? Lightning has problems enforcing on-chain payments. This is a problem if the payment amount is less than the fee for submitting the transaction to the chain. It makes no economic sense to implement this on-chain. This was a very well known problem. This is essentially the same problem as low-value payments that occur directly on-chain, except we are optimistic that everything will work because people are collaborating off-chain. But if you don’t cooperate, problems arise.
This problem is so well known that, in fact, a few years ago there was a lot of debate about solutions to it using various compromises, packet payments. If the HTLC is too small to enforce trustlessness on-chain, you can stream payments in increments of sats (or larger sats) in a trusted manner, and if someone at the hop decides to stop streaming and take another route. You can choose. It will steal the puke from you. The idea is that it’s a reliable payment routing mechanism, but you’ll only lose a little money to an attacker who steals a small portion of your payments, and if someone steals your information while routing a payment, you’ll never route through that node again. . The quote above is from 2019, but the idea was discussed before then.
There’s a problem with lightning! (It’s also a solution to a problem that most people reading this have never heard of.) All of these problems that people think the sky is falling for are problems that have been well understood since the early days of Lightning. This raises the question: Are we wrong again?
You’re not wrong in saying that Lightning is a doomed dead end, but you’re wrong in saying that Lightning, like blockchain itself, will not be used long-term in the way you originally thought. We’re already seeing Lightning become dominated by management applications, and people are working to deploy things specifically designed to sit on top of Lighting. Chaumian ecash mints, Uncle Jim is a LNBits-like setup where people are given administrative accounts for someone’s lightning node. We also have proposals like Ark, which is building out of Liquid’s proof-of-concept phase, that can atomically interact with Lightning payments.
What if Lightning doesn’t become the killer protocol that consumers interact with directly to make payments online? What happens when, like the blockchain itself, other things become part of the payment layer built on top of it?
Could it be the end of the world? Is this a Lightning failure? I maintain that absolutely not the case. From the very beginning of Lightning’s development, it was very clear what the scalability limitations were. white book The literal limitations of Lightning’s potential scalability raise the issue of not receiving support for necessary soft forks in the future..
Lightning can act as a layer for interaction between different custodians, and it is now clearly demonstrating that it does so seamlessly and very effectively. There is absolutely no reason why Lightning couldn’t function as a similar connectivity layer for other Layer 2s with better trust models than explicit custodians. Just because channels aren’t something that’s cost-effective for individuals to have for their daily spending activities, doesn’t mean they’re not cost-effective for LSPs that run new protocols besides Lightning to connect to each other and allow users to interact with each other. . Arks, Statechains and all the new ideas people develop over the next few years.
This can be a translation layer for other systems, extending the ability of end users to onboard and transact on that layer. This is exactly what we realized blockchain should be like. And there’s nothing wrong with that.
This is a guest post by Shinobi. The opinions expressed are solely personal and do not necessarily reflect the opinions of BTC Inc or Bitcoin Magazine.