The Lighting Network - Streaming Money
There is a lot of talk lately about "The Lightning Network" and how it effects bitcoin and id like to try my best to explain it with associated materials as simple and as short as possible.
Not to be confused with Rootstock another development brought about by the same advances in technology which will be a smart contract peer to peer platform on top of the bitcoin network network running as a side chain bringing the functionality of smart contracts to bitcoin the similar to Ethereums platform.
Basically "The Lighting Network" is a complex new technology for cryptocurrnecys, allowing for exponential scaling in transaction volume low cost peer to peer transactions and real time streaming of payments.
What is "The Lighting Network"
An overlay for bitcoin creating bilateral obligations to make transactions at a different time and scale made possible by the implementation of a Time Function Transaction/CheckLockTimeVerify.
Bi-directional payment low-fee transaction.
Decentralized peer to peer payment system.
Smart contract routed payment system based on encrypted onion-routing like what is used with Tor.
Hash locked time contracts.
Real time accounting
CheckLockTimeVerify(CLTV), From bitcoin.it
CheckLockTimeVerify
In late 2015, the BIP65 soft fork[2] redefined the NOP2 opcode as the CheckLockTimeVerify (CLTV) opcode, allowing transaction outputs (rather than whole transactions) to be encumbered by a timelock. When the CLTV opcode is called, it will cause the script to fail unless the nLockTime on the transaction is equal to or greater than the time parameter provided to the CLTV opcode. Since a transaction may only be included in a valid block if its nLockTime is in the past, this ensures the CLTV-based timelock has expired before the transaction may be included in a valid block.
Hashed Timelock Contracts, From bitcoin.it
A Hashed TimeLock Contract or HTLC is a class of payments that use hashlocks and timelocks to require that the receiver of a payment either acknowledge receiving the payment prior to a deadline by generating cryptographic proof of payment or forfeit the ability to claim the payment, returning it to the payer.[1]
The cryptographic proof of payment the receiver generates can then be used to trigger other actions in other payments, making HTLCs a powerful technique for producing conditional payments in Bitcoin.
Onion Routing, From wikipedia.org
Onion routing is a technique for anonymous communication over a computer network. In an onion network, messages are encapsulated in layers of encryption, analogous to layers of an onion. The encrypted data is transmitted through a series of network nodes called onion routers, each of which "peels" away a single layer, uncovering the data's next destination. When the final layer is decrypted, the message arrives at its destination. The sender remains anonymous because each intermediary knows only the location of the immediately preceding and following nodes
Youtube videos explaining "The Lighting Network"
Programmer explains Bitcoin Lightning
aantop Via youtube.com
I hoped this information and the videos provided helped provide a better understanding of The Lighting Network and if you please subsscribe to aantop and Ivan on Tech for providing a wealth on knowledge from which i gained most of my understanding about from.
Please let me know your thoughts on this significant development in cryptocurrencys as a whole.
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I'm looking forward to seeing the lightning network being implemented and the how the evolution of crypto will be from this development.
if development in litecoin is anything to go by will be significant development and a major leap for bitcoin and other compatible cryptos
there was a successful test recently by lightning labs completing payments with a 3-hop in different countries with bitcoin all off-chain
https://www.youtube.com/watch?time_continue=8&v=a73Gz3Tvx3k
https://twitter.com/lightning/status/938453165967515648
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The lighting network could indeed save Bitcoin from the issues you've mentioned above. At Blockbasis we are confident that Bitcoin will go through another growth cycle when the Lighting Network finally goes live. The positive effect will extend far beyond Bitcoin and most likely give market capitalisation a run for its money (literally)!