What is a Lighting Network? Is this the best solution for Bitcoin scalability and high transaction fees? What are you thought?
The Lightning Network concept (LN for short) was described in white paper in February 2015 by Joseph Poon and Thaddeus Dryja - a duo that has been involved with blockchain technology since its early years. Three startups are mainly working on LN development: Blockstream, Lightning Labs and ACINQ, with the participation of other members of the bitcoin community (developers) of course. Each startup works on its own implementation of the LN protocol written in different programming languages.
The first transaction using Lightning Network was made on December 6, 2017 on the main bitcoin network, which previously only took place on a test network.
LN is defined as a kind of overlay on a bitcoin network that can be compared to a memory pool, a type of memory where transactions are waiting to be written on a bitcoin blockchain.
With Lightning Network we can meet not only on bitcoin networks, but also on networks such as Litecoin or Ethereum. On other blockchain there is no such problem with scalability as in the case of bitcoin. An example can be the clogged network in December 2017, when transactions were going on for several days and commissions started from a few dollars. In the case of litecoin and ether, there is no such problem, but their use is much smaller than bitcoin.
Lightning Network is a second layer protocol for Bitcoin created in 2015 especially for cheap, fast and private payments. It is a network made for instant payment channels and transactions are not recorded on the main Bitcoin blockchain. Only channel funding transactions and channel closing transactions are recorded. The main benefit is that the lower fees for Lightning users does not burden miners who are exempt from checking and storing all Lighting transactions. In practice this means that many Lightning transactions can be settled with far fewer off-chain Bitcoin transactions. The fact that transactions are not logged on the blockchain together with the Tor-like routing algorithm for Lightning payments means users can enjoy additional privacy.