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Bitcoin’s Lightning Network Trust Chain Begins Yet Again

#OhNoCrypto

If you’ve been a part of the Bitcoin community for any notable period of time, you likely know that according to many, the cryptocurrency has scaling issues.

Near the top of the crypto bubble in 2017, fees to send BTC surged by thousands of percent from their normal rate to hit $25 to $50, depending on who you asked. This meant that if you requested to pay a few dollars, your transaction could have been stuck in the mempool for hours on end.

But, as with all software, there have been solutions proposed. One of these is the Lightning Network, which is a second-layer scaling solution that effectively migrates some transactions off the main chain to allow for lightning-fast, effectively free, and cross-chain transfers at a high throughput rate.

This technology is currently being worked on by a number of industry companies, such as Blockstream, Lightning Labs, and seemingly Square Crypto, who last year gave a large grant to a leading developer in the Lightning segment of Bitcoin.

And while the Network is still in its infancy, an initiative just started on Twitter that may give the scaling solution more adoption and clout, so to speak.

Bitcoin’s Trust Chain Starts Again

Early last year, Bitcoin proponent and commentator Hodlonaut wrote in a now-famous tweet, “I send 100k sats… to the first person that replies. That person adds 10k sats and sends that to someone. And so on.”

As crazy as this may sound, this challenge of sorts went viral, Crypto Viral anyway. And soon enough, it had a name, the Lightning Network Trust Chain — the idea with this moniker being that users had to trust one another to pass a large sum of BTC onto one another.

The challenge went so viral that Jack Dorsey, the chief executive of Twitter that has been a fan of Bitcoin for a while now, decided to pick up the torch, as did LinkedIn and Microsoft board member Reid Hoffman. (Lightning Labs CEO Elizabeth Stark tried to get Tesla’s Elon Musk to join in on the Bitcoin fun, but he didn’t accept it, unfortunately.)

And as a result, the Lightning Network saw a flurry of growth, with the capacity of the Network nearly doubling in value during the time the chain was being formed.

After someone stole the torch, it had to retire due to technical constraints, with the remaining Bitcoin being deposited as a donation for Bitcoin Venezuela.

And with that, the torch went dark, until today anyway. On Sunday, Hodlonaut once again wrote the exact same message as the above, this time calling it the Lightning Network Trust Chain 2.

So far, the torch has seen around 15 hops, going from person to person without much of a hitch. We’ll keep you updated if any notable members in the Bitcoin or tech communities join in or if it gets stolen.

It isn’t clear what effect the seemingly now-annual Lightning event will have on this Bitcoin technology this time around. But, considering history, it can only do good.

SegWit On the Rise

The steady growth of the Lightning Network has been underscored by the adoption of another scaling solution, Segregated Witness, better known as SegWit.

For those unaware, SegWit is a technical change implemented during the Bitcoin-Bitcoin Cash split of 2017 that effectively changes the way BTC transactions are formatted by removing certain data, allowing for more transactions to be fit into each block.  (Notably, SegWit allows for the Lightning Network to exist due to some technical reasons that can be explained another time.)

SegWit, per data from a data site, now accounts for 66% of all Bitcoin transactions, with large exchanges and service providers adopting the solution.

The growth of both SegWit and the Lightning Network (along with fledgling scaling solutions enabled through Schnorr Signatures) should help reduce BTC transactions fees with time, and potentially make the cryptocurrency more usable as a day-to-day medium of exchange. 

The post Bitcoin’s Lightning Network Trust Chain Begins Yet Again appeared first on Blockonomi.



OhNoCryptocurrency via https://www.ohnocrypto.com/ @Nick Chong, @Khareem Sudlow