8 ms·

You know what? All the hops where your TCP/IP connection has gone to allow you to write that message, were provided by devices that had to be online in order to

by knocte 9y ago

You know what? All the hops where your TCP/IP connection has gone to allow you to write that message, were provided by devices that had to be online in order to provide you the services. EOM

foepys 9y ago
Yes, but routers aren't responsible for keeping my money safe. If you don't constantly monitor all your LN channels, the other party can just steal your money by issuing fraudulent messages to the network.
- Klathmon 9y ago
  Someone can setup "watchdog" services that you can give your revocation transactions to and they can watch the blockchain for any attempts to "steal" your money and if any are found they can instantly broadcast the revocation. Doing it this way you don't give the "watchdog" service any control of your BTC, just the ability to broadcast countersignatures, which means there is still no counterparty risk here. You could even give your revocation transactions to multiple 3rd parties that can all watch the blockchain for you if you don't trust any one of them to not backstab you.
  - foepys 9y ago
    But what happens if a watchdog has an outage? I need multiple backup watchdogs then, and no watchdog will work for free. So I'm now paying multiple entities to securely transact money to other people that themselves also need watchdogs to watch their channels. This sounds not like it will result in low fees. Transaction fees, maybe, but overall fees including middlemen will be quite a bit higher.
    - xur17 9y ago
      I'm curious if anyone has found a good writeup on how watchtowers work. My understanding is that with the normal lightning network, there is a reward built in that you receive if your counterparty tries to fraudulently close the transaction. You receive your money + some of what they owned. From what I remember, watchtowers can be incentivized by receiving a portion of this money. This way you only pay something if your counterparty tries to screw you, and the amount you pay doesn't come out of your money. tldr; I think the watchtower fees are only paid if a problem occurs, and even then your counterparty is the one that effectively pays the fee.
    - Klathmon 9y ago
      >But what happens if a watchdog has an outage? Locktimes are currently on the order of days (roughly 3 days IIRC), which means you have days to react to a fraudulent transaction. A dedicated watchdog service being out for days at a time is pretty shitty uptime. Not to mention that this isn't the ONLY way you can watch out for this. Your laptop, phone, or any other internet connected device can also watch for these transactions, as long as you connect to the network once every 3 days, you can handle it yourself. >...and no watchdog will work for free. I'm sure you are correct, but we will need to see the exact costs here. I'm guessing (and it is a complete guess) that the costs here won't be that bad at all. You could write a service that scans the blockchain for these transactions that would easily run on a very small server with a VERY large number of revocation transactions, so it's not like it's a large cost to run a service like this. Not to mention that the "fee" for these services could be paid by "penalty" forced onto the person that tried to cheat you when the revocation transaction is broadcast, incentivizing the watchdog service to catch the fraudulent transactions (since that's the only way they get paid). Plus I have a feeling this can easily be a value-added service to many exchanges and custodial wallets.
      - umanwizard 9y ago
        3 days? In contrast, your liability is capped at $500 if you inform your bank of debit card fraud within 60 days.
        Klathmon 9y ago
        That time is completely configurable between you and the person you are opening a channel with, 3 days just seems to be the number everyone is gravitating toward using as a good default since it's long enough that short times offline won't cause you to be vulnerable to fraudulent transactions, but not long enough to cause issue if the channel you are working with decides to close up suddenly (because after the locktime is up you can broadcast a transaction which gives you all the money in the channel). And yes, your bank can reimburse your for fraudulent charges (the amount and timing depends on your location), but that also depends on your bank not deciding that your fraud isn't actually fraud, it depends on you (as in your person) constantly checking your accounts for fraud and manually reporting it to the proper channels when it happens, you are still out the money while they investigate and reimburse in some cases, they will lock and reissue your card which often takes days to arrive leaving you without a card in the meantime, they can deny your account entirely for any number of reasons, they can control what you are able to buy with your card for any number of reasons, the cost of a bank account is far from free, they can and will charge you to get access to your own money quite often, and they can deny you from withdrawing your own money at any time for just about any reason (including "you are withdrawing too much money"). Neither option is perfect, nobody says they are, but I really believe that a system like Bitcoin and LN are a significant improvement over the traditional banking system in many ways. It is worse in some ways for sure, but I feel the benefits far outweigh the down sides.
- darawk 9y ago
  Which is why trusted intermediaries like banks will arise. They will be responsible for monitoring the channels, and they'll do a good job of it. The important distinction, however, is that you will still have the option of broadcasting transactions to the main blockchain for a fee. Which means that you still have ultimate sovereignty over your funds.
  - Erlangolem 9y ago
    So like banks, but with a much darker recent history of taking the money and running, none of the stability, and none of the insurance. All traded for the dubious benefit of broadcasting transactions to the blockchain, which seems like an empty sop to principle. I don’t care how many times “ultimate sovereignty” gets thrown around like it means anything important outside of a few narrow circles. As a currency Bitcoin just stinks, as an anonymous means of transferring money it stinks, but it’s a great way to shuffle money or rob someone. If people didn’t think they were going to use bitcoin to get rich quick, they just wouldn’t care. Well, except for scammers and money launderers.
    - gruez 9y ago
      >but with a much darker recent history of taking the money and running there's nothing to steal. nobody is "holding" your money for you.
      - Erlangolem 9y ago
        Whoever is running my node 24/7 is, if I want the convenience of money. If I’m using a paper wallet and a bank vault, I might as well buy platinum, for which demand is more than a phantom.
        darawk 9y ago
        Yes, but there will be a liquid market in such nodes. Finding them will never be a problem.
sireat 9y ago
How does Lignting Network plan to deal with the fact that each transaction appears to require rerouting? White paper glosses over this fact. This seems like a huge rise in exponential complexity. Because the channel balances change, the best(sometimes only) route change depending on each transaction. An analogy would be the chaos that would ensue were each TCP/IP packet to require reworking of BGP routing tables. PS Plus you have to worry about malicious nodes.
jancsika 9y ago
Yes, and in cases where there the stakes are substantial (or are perceived as substantial) those packets stop flowing or get throttled. That doesn't seem like a great model for a payment system that aims to take over from the current processors.
UncleMeat 9y ago
And we pay large amounts of money to middlemen to access these connections. And these middlemen can often block your traffic at will. Why not just use banks at this point?
- hahainternet 9y ago
  You need to physically connect your premesis to the middlemen. In lightning, you need only virtually connect them. There's a literal world of difference between the two.
  - vokep 9y ago
    If you want to be lame and try to invalidate an argument sure you can say there's a literal world of difference in an analogy, but thats the entire point of an analogy, to show similarity by demonstrating something relatively simple often in a wildly different context. Theres still a middleman with plain BTC, its just that there are a ton of them, and little barrier to entry to becoming a middleman yourself. Lightning requires things which realistically only banks will be able to provide, large payment channels. The whole point is that when you can store your balance on a decentralize ledger, there's no need for a bank.

by knocte 9y ago

You know what? All the hops where your TCP/IP connection has gone to allow you to write that message, were provided by devices that had to be online in order to provide you the services. EOM

foepys 9y ago

Yes, but routers aren't responsible for keeping my money safe. If you don't constantly monitor all your LN channels, the other party can just steal your money by issuing fraudulent messages to the network.

Klathmon 9y ago
Someone can setup "watchdog" services that you can give your revocation transactions to and they can watch the blockchain for any attempts to "steal" your money and if any are found they can instantly broadcast the revocation. Doing it this way you don't give the "watchdog" service any control of your BTC, just the ability to broadcast countersignatures, which means there is still no counterparty risk here. You could even give your revocation transactions to multiple 3rd parties that can all watch the blockchain for you if you don't trust any one of them to not backstab you.
- foepys 9y ago
  But what happens if a watchdog has an outage? I need multiple backup watchdogs then, and no watchdog will work for free. So I'm now paying multiple entities to securely transact money to other people that themselves also need watchdogs to watch their channels. This sounds not like it will result in low fees. Transaction fees, maybe, but overall fees including middlemen will be quite a bit higher.
  - xur17 9y ago
    I'm curious if anyone has found a good writeup on how watchtowers work. My understanding is that with the normal lightning network, there is a reward built in that you receive if your counterparty tries to fraudulently close the transaction. You receive your money + some of what they owned. From what I remember, watchtowers can be incentivized by receiving a portion of this money. This way you only pay something if your counterparty tries to screw you, and the amount you pay doesn't come out of your money. tldr; I think the watchtower fees are only paid if a problem occurs, and even then your counterparty is the one that effectively pays the fee.
  - Klathmon 9y ago
    >But what happens if a watchdog has an outage? Locktimes are currently on the order of days (roughly 3 days IIRC), which means you have days to react to a fraudulent transaction. A dedicated watchdog service being out for days at a time is pretty shitty uptime. Not to mention that this isn't the ONLY way you can watch out for this. Your laptop, phone, or any other internet connected device can also watch for these transactions, as long as you connect to the network once every 3 days, you can handle it yourself. >...and no watchdog will work for free. I'm sure you are correct, but we will need to see the exact costs here. I'm guessing (and it is a complete guess) that the costs here won't be that bad at all. You could write a service that scans the blockchain for these transactions that would easily run on a very small server with a VERY large number of revocation transactions, so it's not like it's a large cost to run a service like this. Not to mention that the "fee" for these services could be paid by "penalty" forced onto the person that tried to cheat you when the revocation transaction is broadcast, incentivizing the watchdog service to catch the fraudulent transactions (since that's the only way they get paid). Plus I have a feeling this can easily be a value-added service to many exchanges and custodial wallets.
    - umanwizard 9y ago
      3 days? In contrast, your liability is capped at $500 if you inform your bank of debit card fraud within 60 days.
      - Klathmon 9y ago
        That time is completely configurable between you and the person you are opening a channel with, 3 days just seems to be the number everyone is gravitating toward using as a good default since it's long enough that short times offline won't cause you to be vulnerable to fraudulent transactions, but not long enough to cause issue if the channel you are working with decides to close up suddenly (because after the locktime is up you can broadcast a transaction which gives you all the money in the channel). And yes, your bank can reimburse your for fraudulent charges (the amount and timing depends on your location), but that also depends on your bank not deciding that your fraud isn't actually fraud, it depends on you (as in your person) constantly checking your accounts for fraud and manually reporting it to the proper channels when it happens, you are still out the money while they investigate and reimburse in some cases, they will lock and reissue your card which often takes days to arrive leaving you without a card in the meantime, they can deny your account entirely for any number of reasons, they can control what you are able to buy with your card for any number of reasons, the cost of a bank account is far from free, they can and will charge you to get access to your own money quite often, and they can deny you from withdrawing your own money at any time for just about any reason (including "you are withdrawing too much money"). Neither option is perfect, nobody says they are, but I really believe that a system like Bitcoin and LN are a significant improvement over the traditional banking system in many ways. It is worse in some ways for sure, but I feel the benefits far outweigh the down sides.
darawk 9y ago
Which is why trusted intermediaries like banks will arise. They will be responsible for monitoring the channels, and they'll do a good job of it. The important distinction, however, is that you will still have the option of broadcasting transactions to the main blockchain for a fee. Which means that you still have ultimate sovereignty over your funds.
- Erlangolem 9y ago
  So like banks, but with a much darker recent history of taking the money and running, none of the stability, and none of the insurance. All traded for the dubious benefit of broadcasting transactions to the blockchain, which seems like an empty sop to principle. I don’t care how many times “ultimate sovereignty” gets thrown around like it means anything important outside of a few narrow circles. As a currency Bitcoin just stinks, as an anonymous means of transferring money it stinks, but it’s a great way to shuffle money or rob someone. If people didn’t think they were going to use bitcoin to get rich quick, they just wouldn’t care. Well, except for scammers and money launderers.
  - gruez 9y ago
    >but with a much darker recent history of taking the money and running there's nothing to steal. nobody is "holding" your money for you.
    - Erlangolem 9y ago
      Whoever is running my node 24/7 is, if I want the convenience of money. If I’m using a paper wallet and a bank vault, I might as well buy platinum, for which demand is more than a phantom.
      - darawk 9y ago
        Yes, but there will be a liquid market in such nodes. Finding them will never be a problem.

sireat 9y ago

How does Lignting Network plan to deal with the fact that each transaction appears to require rerouting? White paper glosses over this fact. This seems like a huge rise in exponential complexity. Because the channel balances change, the best(sometimes only) route change depending on each transaction. An analogy would be the chaos that would ensue were each TCP/IP packet to require reworking of BGP routing tables. PS Plus you have to worry about malicious nodes.

jancsika 9y ago

Yes, and in cases where there the stakes are substantial (or are perceived as substantial) those packets stop flowing or get throttled. That doesn't seem like a great model for a payment system that aims to take over from the current processors.

UncleMeat 9y ago

And we pay large amounts of money to middlemen to access these connections. And these middlemen can often block your traffic at will. Why not just use banks at this point?

hahainternet 9y ago
You need to physically connect your premesis to the middlemen. In lightning, you need only virtually connect them. There's a literal world of difference between the two.
- vokep 9y ago
  If you want to be lame and try to invalidate an argument sure you can say there's a literal world of difference in an analogy, but thats the entire point of an analogy, to show similarity by demonstrating something relatively simple often in a wildly different context. Theres still a middleman with plain BTC, its just that there are a ton of them, and little barrier to entry to becoming a middleman yourself. Lightning requires things which realistically only banks will be able to provide, large payment channels. The whole point is that when you can store your balance on a decentralize ledger, there's no need for a bank.