Lightning Network : Atomic Swap Settlement Process (Explained)

Hi everyone.

I will introduce you to the utilization of the lightning network.

What is Lightning Network?

The Lightning Network is a proposed solution to the bitcoin scalability problem that was deployed in January 2018. The network would use an off-chain protocol and is currently under development.

First, let's look at the Atomic Swap feature of Lightning Networks. Atomic swaps are also referred to as atomic cross-chain trading, which allows transactions to be processed within the lightning network using hash-time locked contracts.

Simply put, bitcoin and alt coins in the lightning network can be instantly traded and exchanged in real time.

Let's take an example. (* Assume 1 bit coin is the same price as 100 light coin!)

1. If you exchange your virtual currency for another type of virtual currency

'A' has 100 light coins and 'B' has one bit coin and wants to exchange. But A and B do not know each other, so I do not want to give them coins first. I gave it to you first, but you can not go to the police station because the other party does not give you a coin. In this case, A and B exchange their coins by setting the atomic swap within the lightning network.

First, a A submits a transaction to the light coin block chain because it has a light coin, and the B has a bit coin to submit the transaction to the bit coin block. 100 light coins of a A go to a dove, and a bit coin of a dove goes to a A , but when a covert code, which is similar to an esC concept, is disclosed, each coin must have its own address Will arrive. These transactions of A and B are carried out in different block chains, but you can effectively carry out transactions in the form of block chains connected to the lightning network.

2. If you purchase a product that is sold as a virtual currency with other types of virtual currency.

A still have 100 light coins, B have one bit coin, and C want to sell one supercomputer for one bitcoin.

When a A opens a B and light coin payment channel and the C has opened a C and a bit coin payment channel, the A sends 100 light coins to the B , the B sends a bit coin to the C, Will give you a supercomputer. In this way, bit coins and other alt coins (Light Coin, Dodge Cache, Dozier Coin, But Coin, etc.) linked in the Lightning Network can easily handle transactions through the Lightning Network and Atomic Swap without any additional process. Between the A and the C trade, the B plays an intermediate role.

It is important to know how the Segwite will be used in the Lightning network in the future, and the importance of the funds to be deposited in the Lightning network, and the processing of unused payment channels is also important. I think it is an outgoing process. If the day that the lightning network is successfully used comes, it seems that transactions can be handled efficiently with the combination of bit coin and other alt coins.

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