[rob001]

Correct me if i'm wrong, but to open a payment channel with another party on the lightninng network (for example Starbucks to buy coffees) you need an onchain transaction. Then when you finally want to settle all of the lightning network transactions (pay your tab) you need another transaction. So you need at least two onchain transactions for every merchant you want to trade with.

The reason this doesnt scale is because for 100 million people to open one payment channel, it will take over a year to process all of those transactions. That wouldn't happen though as the transaction costs would skyrocket to the point people wouldn't bother.

Am I wrong? Genuinely, this is how I see it and why it cannot work.

[keymone]

> you need at least two onchain transactions for every merchant you want to trade with

you absolutely do not. you open a channel once with some node and that channel can be used to send payments to all other nodes.

it's also simplistic view that you need 2 transactions per settlement of a channel because with channel factories you can batch-open-and-close-and-top-off many different channels with single (albeit fairly large) transaction.

systems like that grow organically and people get onboarded via many different methods, so it's not like tomorrow we will have a queue of 100 million people waiting for channels to be opened.

i do expect bitcoin network to hit capacity limit by transactions in future and we will see what it is going to look like, but i rather prefer bitcoin's glacial pace of becoming more and more efficient at ground layer, forcing all sorts of experimentation to happen in upper layers and in sidechains without ever compromising the foundation.

[rob001]

Ok so I've learnt something there, just one transaction to open a channel that everyone uses. But then what happens when you've transacted with say 30 different merchants, and the tab is called? Is that one bitcoin transaction to settle, or 30 since you're presumably sending bitcoin to 30 different wallets?

Personally I don't like the glacial pace of ground layer dev, as it makes me think this stuff can't be solved. Each way you approach it is a compromise.

[xiphias2]

It's called lightning network for a reason. It's a network of Bitcoin channels. You can open a channel with Burger King and use it at McDonald's. The latter will route the payment instantly to the former, and all channel states will be updated. Read the lightning channel technical papers if you're interested, it's really worth it.

[keymone]

It’s one transaction to settle any number of in-channel transactions. That’s why it doesn’t make sense to talk about 7 transactions per second because every one of them can represent a billion value exchanges.

It is infinitely more important to preserve stability of foundation than it is to experiment with new features. Bitcoin runs in its current form for more than a decade and that stability is worth a lot.

[rkagerer]

I'm concerned that looks a lot like a more conventional system where you have centralized payment processors. The best-connected ones are most successful, incentivizing acquisitions until there are very few of them or even a duopoly.

What discourages that?

[keymone]

No centralized processors, all channels are permissionless and lightning nodes cannot monitor or censor any traffic.

[VHRanger]

Right, but decentralized permission less L2 solutions are also technically useless because they generate an unsolved Canadian Traveller Problem

To which the only solution is basically opening a new channel - eg. A new L1 transaction

[keymone]

https://news.ycombinator.com/item?id=28941210