Getting Onto Lightning
Hey Jessatoshis
The lightning network is a fairly new technology and side-chain hoping to off-load the smaller Bitcoin transactions and keep it off-chain. The network is aimed at the retail end-user and wants to facilitate cheap instant payments and payment streaming, and smart contract payments.
I've been messing with the network for some time now, learning how it works, its various pros and cons and why it's been held up as one of the scaling solutions for future Bitcoin use.
Like any decentralised network, it requires support from the community. Bitcoin's main chain is supported by miners and nodes; the lightning network is supported by Bitcoin full nodes that also run a lightning client.
The main-chain
The main-chain is supported by everyone running a full node, miners providing hash power, mining pools regulating the mempool, wallet providers, exchanges, users and businesses. It has formed a bit of a closed-loop economy first, and then it opened up to greater crypto with altcoins where people could trade between them and now even banks.
The main chain has now even added second layers like liquid and lightning, which I think also require the same level of support, if not more. I see lightning as a consumer portal of Bitcoin that could even be a closed system where you don't need to hit the base chain. You keep a certain value and use it as you need it every day.
Running a node
Remember, lightning is still only a few years old and is still an experiment, but If you wanted to support lightning and use it in the safest way possible, the best action to take is spinning up your own lightning node. That way, you control your sats, you make sure you're running the right software, checking transactions and control who gets to connect to your channels.
Loading up liquidity
If you're not that technical but still want to mess around, you may want to turn some fiat or Bitcoin into lightning Bitcoin. This can be used to play around with Lapps, trade between exchanges that support lightning. Since you can make trades quicker and cheaper, you can take advantage of arbitrage trades between these exchanges or keep your BTC with you and never leave it on exchanges.
Managing your UTXOs
Hitting the main-chain will continue to increase in price, and if you want to ensure that you're using the Bitcoin chain optimally, you need to keep your footprint as small as possible. Lightning allows you to consolidate transactions and value into a lightning wallet, and when you have a big enough kitty, you can lock it up on the main chain.
Using or building lapps
Lapps are just short for lightning apps, just like altcoins have dApps, but lightning apps don't actually work on chain; they only do the settlement of transactions with lightning. If you want to mess around with a few laps, you can find some to try here
If you have a site that could leverage Bitcoin, perhaps you could integrate lightning as a payment solution and upgrade it to a lapp.
Getting set up on lightning
Lightning is only getting started, and as the network effect of Bitcoin grows, it's shown to grow networks tethered to it as we see with the altcoin market.
Have your say
What do you good people of HIVE think?
So have at it, my Jessies! If you don't have something to comment, "I am a Jessie."
Let's connect
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