[Cryptography] Electronic currency revived after 20-year hiatus

Peter Todd pete at petertodd.org
Fri Aug 19 01:09:03 EDT 2016


On Thu, Aug 18, 2016 at 11:40:58AM -0700, Ray Dillinger wrote:
> The "Lightning Network" solves a problem for people who do many
> transactions per day with each other.  There is no merchant nor client
> with whom I do more than one transaction per day, so absolutely none of
> my transactions would wind up using it.  I expect it to have some real

You're thinking of payment channels, not the Lightning network.

The difference is that while payment channels only go between two parties, the
Lightning network is essentially a network of payment channels, allowing for
routes to be constructed. So while you may not personally have a payment
channel open with a given merchant, someone else will, and so long as you have
a route in the network to that other preson, you can send funds to the merchant
by sending the payment through a multi-hop route.

This is possible because individual payments in a payment channel have
essentially zero marginal cost, instant, and trustless.

-- 
https://petertodd.org 'peter'[:-1]@petertodd.org
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