Guide On Bitcoin Lightning Network
Lightening Network solutions have been planned to be used by the community to solve Bitcoin’s lasting issues which are ultra-scalable.
An increase in Bitcoin block size should have made Bitcoin more scalable on the base chain which
was attempted in 2017 and it could have affected Bitcoin decentralization.
The big and small blockers that the Bitcoin community split, also a battle leading to a blockchain fork, and Bitcoin Cash(BCH) was created with 8MB blocks against ~1MB of Bitcoin BTC block at a time.
Read Also: All You Need To Know On Decentralized Finance (DeFi)
Until recently, the lightning network has grown so well on the average node of 8500-18000 active computer
running the network between May 2021-2023 to be precise.
One intriguing feature of the Lightning Network is the immediate payment at very reduced fees or
charges. Its capabilities can process 1 million transactions per second compared to 65000
processed by Visa.
A brief explanation of The Bitcoin Lightning Network?
The Bitcoin Lightning Network basically is the latter 2 solutions that run on nodes worldwide, this is done to alleviate the problem of congesting the network.
Also, it ti a payment protocol that was built on a blockchain layer to enhance faster and more effective microtransactions at a lower cost. The base layer is used basically for dispute resolution or capital distribution into channels.
Furthermore, the Bitcoin lightning Network enables users to transact with ease, cost-effective and
overcoming the challenges posed by overcrowding the underlying blockchain.
Moving the transactions to the Bitcoin Lightning Network layer 2 helps the layer 1 Bitcoin blockchain
to be faster interns of functionality.
It should be noted that smart contracts are used in payment protocol between two users that can transfer funds in a twinkle of an eye.
Read Also: The Role Of Smart Contracts In Blockchain Technology
Earlier users of the Bitcoin Lightning Network have the advantage of not opening the channels again since
the network would recognize that they have used the channels for payment before the network will automatically transfer the money.
It is expedient to Know that immediately Bitcoin Lightning Network wallet is set up, and loaded with BTC or
SATS etc. This opens up a channel to receive or send money.
This protocol adopts the routine service that immediately and effectively transfers money irrespective of the user’s prior usage of the system.
The Bitcoin Lightning Network users can close down their payment channels at will and still settle their
final balance on the core blockchain at any time.
Note that only the opening and closing of transactions are recorded on the layer 1 blockchain, therefore, it cannot be congested by lightning transactions.
Among many benefits, the Bitcoin Lightning Network can also be used for tipping because it settles the
payment Instantly and it is virtually free of charge.
Recently, Bitcoin Lightning Network was adopted by Bitcoin and cryptocurrency exchanges for example,
Kraken and coin base are among the first to provide users with the payment service.
Read Also: How To Use Cryptocurrency For Cross-Border Payments.
Inventor Of Bitcoin Lightening
In order to resolve Bitcoin and the other blockchains’ scalability problem, in 2016 both Thaddeus Drya
which is a developer and Joseph Point a researcher invented the Bitcoin lightning.
The white paper of the Bitcoin lightning Network and lightning labs were funded by San Francisco based
software development company on January 14th, 2016.
Elizabeth Stark was also involved and she was the public representative of the Lightning Network.
Step By Steps Of Sending And Receiving Bitcoin On Lightening Network in Second
The Bitcoin Lightning Network wallet can be custodial (e.g. Satoshi wallet, strike, etc) and non-custodial
(muum, breeze zap, etc). They make lightning payments easy and fast.
The steps are
- Fund your wallet by sending BTC from an exchange e.g. Binance, bybit, etc. Or buy directly using the
app. - To pay a merchant, scan the QR code and confirm the payment
- Â To receive payment, click the Receive column and allow the sender to scan your QR code.
Note that all Bitcoin Lightning Network wallets have virtually the same setup and they are extremely easy
to use.
Conclusion
As the digital world is changing daily, and modification is introduced at intervals, it is important that a user gets equipped with the basic knowledge that is introduced on a daily basis. this will help you keep to date on all the happenings and not be left out.
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Meet Daniel Abang: Crypto guru, content creator, and analyst. With a deep understanding of blockchain, he simplifies complex concepts, guiding audiences through the ever-changing crypto landscape. Trusted for his insightful analysis, Daniel is the go-to source for staying informed and empowered in the world of cryptocurrency.
