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This is an excellent high level description. Lightning network allows for an arbitrary high number of tx, but can only tx on value that has specifically been l

This is an excellent high level description. Lightning network allows for an arbitrary high number of tx, but can only tx on value that has specifically been locked to do so. Essentially you end up creating a bidirectional link for each on-chain tx, the weight of each link is the amount of value that can flow in that direction. Joining a bunch of these links together potentially allows for just locking up funds with some larger node in the LN and having near instant and extremely cheap payment to node that is traversable from your link. One of the really cool things about this architecture is that as long as two blockchains offer atomic x-chain txs then the same principal should work for LN. (e.g. send litecoin down a LN payment channel the business gets bitcoin on the other end) Unfortunately this does have security implications, LN's security model relies on monitoring the blockchain to ensure that the other side of the channel doesn't attempt to close the channel to their benefit, if they do there is remediation you can do, but you have to be monitoring the channel. Also an inability to close the payment channel (tx on the blockchain) within a certain # of blocks could result in the history of the payment channel getting cleared. Basically if the bitcoin network experiences a huge tx backlog like we saw a couple months ago (tx fees exceeding 15-20 USD) and we see third party routers with high dependency/volume we could see a double spend attack that would be cost prohibitive to stop.

polyomino 9y ago
There is no added risk of double spend in lightning. The risk in lightning is that your counterparty can close the channel on an old state that benefits them. If you, or your watchtower (not yet implemented) is not there to punish fast enough, they can run away with your bitcoin.
- WJW 9y ago
  What happens if they DDOS you (or your watchtower) at the right moment? Most peoples' bandwidth is shit enough that forcing them offline is fairly straightforward.
  - __blockcipher__ 9y ago
    You get fucked over. That, along with hot wallets, is why lightning is a horrific security nightmare. It's not built to withstand adversarial attacks the way bitcoin itself was. To be blunt, they took an elegant vision by Satoshi and shit all over it
  - Klathmon 9y ago
    Locktimes are about 3 days, they would have to ddos you for the whole time in order to steal anything. If at any point during those 3 days you are able to broadcast your transaction in any way, you get all the money in the channel from both participants.
- XR0CSWV3h3kZWg 9y ago
  Sorry I guess I was using double spend to characterize any situation where you think a tx has taken place, but another party rolls back to a different or prior state.
Klathmon 9y ago
Par of the counter transaction system that LN has means that if someone tries to screw you over and you catch it, you get ALL of the money in the channel combined. So if your channel was just $50 from both parties, you could broadcast your counter transaction with up to $50 in fees and still break even, since you are basically spending the fraudsters money.

polyomino 9y ago

There is no added risk of double spend in lightning. The risk in lightning is that your counterparty can close the channel on an old state that benefits them. If you, or your watchtower (not yet implemented) is not there to punish fast enough, they can run away with your bitcoin.

WJW 9y ago
What happens if they DDOS you (or your watchtower) at the right moment? Most peoples' bandwidth is shit enough that forcing them offline is fairly straightforward.
- __blockcipher__ 9y ago
  You get fucked over. That, along with hot wallets, is why lightning is a horrific security nightmare. It's not built to withstand adversarial attacks the way bitcoin itself was. To be blunt, they took an elegant vision by Satoshi and shit all over it
- Klathmon 9y ago
  Locktimes are about 3 days, they would have to ddos you for the whole time in order to steal anything. If at any point during those 3 days you are able to broadcast your transaction in any way, you get all the money in the channel from both participants.
XR0CSWV3h3kZWg 9y ago
Sorry I guess I was using double spend to characterize any situation where you think a tx has taken place, but another party rolls back to a different or prior state.

Klathmon 9y ago

Par of the counter transaction system that LN has means that if someone tries to screw you over and you catch it, you get ALL of the money in the channel combined. So if your channel was just $50 from both parties, you could broadcast your counter transaction with up to $50 in fees and still break even, since you are basically spending the fraudsters money.