This article is one of the “Derek Lightning” series of articles by community Diamond HandsThe largest Lightning network community has been developed in Japan. The purpose of writing these articles is to provide general information about Lightning technology and ecosystem for non-professional audiences. you can The first article And The second article Read from related links. In this article prepared for you by Mihan Blockchain, Advanced applications of lightning network in the future of the web And we will examine how these applications are implemented.
Advanced applications of lightning network in the future of the web
As you know, the Lightning network is considered a layer two and off-chain solution for the Bitcoin network, which enables two-way secure payment between two or more people without the need for trust. The Lightning Network is not only a payment scaling solution in the Bitcoin network and has a much higher potential. Since anyone can operate on this network without the need for permission, it is possible to form an ecosystem of peer-to-peer service providers that work on top of vanilla and custom Lightning channels. In addition, if applications that are resistant to the restrictions of technology giants and payment companies become valuable in the market, then the Lightning Network will be one of the most suitable options for any type of payment.
In this part of the article, to explain Some advanced applications of Lightning Network we pay
1. Peer-to-peer financial system
One of the outstanding features of the Lightning network, which we find when comparing this network with other payment technologies, is the peer-to-peer architecture. Naturally, not everyone wants to set up a node in the Lightning network. However, setting up and managing a node for personal use is relatively simple and convenient, and probably in the coming years, we will see the launch of a large number of lightning nodes related to different businesses. Finally, these factors will provide the possibility of providing different financial services on a peer-to-peer basis in the Lightning network.
Bitcoin’s script limitations prevent contracts from being enforced through global consensus rules, but the state of the Lightning network is managed by connected peers, and thus different management protocols can be tracked. The goal of solutions such as DLC contracts is to achieve privacy and enforce such contracts. Of course, with the difference that they rely on anonymous oracles and similar contracts can be recreated in the Lightning network. In this way, it is possible to conduct peer-to-peer transactions with the least need for trust between peers of a channel.
If the relationship between these peers is such that it is possible to compromise on the implementation of such contracts (the need for trust is eliminated and proof of fraud is sufficient), the trading space between peers becomes much larger. Such channels can handle things like validation and execution on blockchains or other databases.
Currently, credit-driven channels, known as hosted channels, are used for community banking services such as Fiat Lightning Channels. In theory, even exchange accounts are considered a hosted channel. Such structures give us the flexibility to be aware of financial applications and user experiences in the present, especially when the services provided require custody and trust.
In addition to the possibilities that customized state management creates for individual channels, the systematic risks of the network are also reduced by the peer-to-peer financial system. If one credit-driven channel provider goes bankrupt, other credit-driven channels and their users are also affected. But other normal network channels will not be affected (assuming they don’t rely on this provider behind the scenes). Normal lightning channels are completely safe and protected; Because they are fully guaranteed and do not require a license.
Finally, we see the emergence of a number of experimental projects with a token issuance plan that enable the transfer of digital currencies on the Lightning network. Of course, the advantages of such projects are still a bit unclear, because most token services are provided by a centralized unit, and as a result, it is better for them to use a centralized database and a hub-and-spoke model. However, there is a lot of interest in token development on the Lightning Network, and this could lead to useful innovations.
2. Making payments on a more decentralized web
Since Lightning is a payment technology, it is better to know what problems this solution will solve. According to the recent events, a definite and clear answer can be given to the above question: Lightning provides the possibility of anti-censorship and anti-blocking payments.
In fact, the concept of Web 5 introduced by Jack Dorsey’s TBD project is about building a decentralized platform that removes concerns about identity, data storage, authentication, and application distribution, freeing users from the harms of large technology platforms. and protects payment providers.
In Web 5 itself, there is no mandate to use Lightning or Bitcoin, but there are strong synergies between Lightning and the Web, where users can selectively provide data to applications by running servers (even if some don’t want to run their own servers or nodes). do). Thanks in part to node management projects like Umbrel, RaspiBlitz, etc., enthusiasts are running thousands of nodes on the Lightning Network.
In fact, since Lightning Payments are technically a transaction between predefined information (the preview) and Bitcoin, they are very suitable for information-related payments (such as monetary content, data recovery, or critical content). There are also a number of Lightning-based applications (Lapp) that provide these types of applications.
Even if measures to decentralize the web like Web 5 don’t materialize (and most users and developers prefer the closed space offered by big tech companies), there is still a politically neutral and easily verifiable anti-censorship currency. Yes, it is very valuable because the process of politicization of the monetary system will continue. Even traditional and completely custodial programs can benefit from the ability to cooperate with programs that allow for the withdrawal and deposit of Lightning.
The Lightning Network has a long way to go for public acceptance and has to overcome many obstacles. However, with the growth of this network and the increasing interest of developers in it, the Lightning network will become one of the best platforms for peer-to-peer applications and financial systems. In this article, Advanced applications of lightning network in the future of the web We explored and answered the question of how Lightning can make the web more decentralized. What do you think about Lightning Network and its future direction? Share your opinion with us.