Sunday, 29 April 2018

Is this how Lightning will operate when it matures?


Tell me if I’m missing anything important in the steps below. Please ignore that I’m making the network simple and my Lightning payments only travel through the same 3 nodes. Also, please ignore that the fees listed are for easy calculation and not meant to be exactly what will be charged for these transactions.Start with 1 BTC in wallet regular Bitcoin wallet as well as 0.01 BTC in wallet on Lightning Network.Buy lunch almost instantly on Lightning Network in the amount of 0.001 BTC and also paying 1 satoshi to Node A and 0.5 satoshi to Node B in fees. Current balance 1 BTC in regular Bitcoin wallet and 0.008999985 Bitcoin in Lightning wallet.Buy soda from vending machine almost instantly on Lightning Network in the amount of 0.0001 BTC and also paying Node A 0.1 satoshi and Node B 0.05 satoshi and Node C 0.1 satoshi in fees. Current balance 1 BTC in regular Bitcoin wallet and 0.0088999825 BTC in Lightning wallet.I need to make a car payment and there is not enough in my Lightning wallet so I move 0.05 BTC from regular wallet to Lightning wallet. In the same blockchain transaction, the remaining 0.95 BTC in the regular Bitcoin wallet are automatically moved to a new address in the same regular Bitcoin wallet and this transaction has a mining fee of 1000 satoshi. This takes approximately 30 minutes to get 3 confirmations. The 0.95 BTC (okay, 0.94999 after the mining fee) in the regular Bitcoin wallet are still recoverable by the same secret 12 words even though they are in a new address in the regular Bitcoin wallet. Balance after the 30 minute wait is 0.94999 BTC in regular Bitcoin wallet and 0.0588999825 BTC in Lightning wallet.Pay car loan almost instantly in the amount of 0.03 BTC on Lightning Network and also pay Node A 30 satoshi and Node B 30 satoshi in fees. Current balance 0.94999 BTC in regular Bitcoin wallet and 0.0288993825 BTC in Lightning wallet.Payroll sends me a notice requesting the Lightning Network address my payroll should be deposited in. A few seconds after signing into the payroll system and giving the address, my 0.1 BTC paycheck shows up in my Lightning wallet. Current balance 0.94999 BTC in regular Bitcoin wallet and 0.1288993825 BTC in Lightning wallet.Pay house payment almost instantly of 0.05 BTC on Lightning Network and also pay Node A 50 satoshi and Node B 25 satoshi in fees. Current balance 0.94999 BTC in regular Bitcoin wallet and 0.0788986325 BTC in Lightning wallet.Pay electricity bill almost instantly of 0.01 BTC on Lightning Network and also pay Node A 10 satoshi and Node B 5 satoshi and Node C 5 satoshi in fees. Current balance 0.94999 BTC in regular Bitcoin wallet and 0.0688984325 BTC in Lightning wallet.I look at the spending money I need for the next couple of weeks and decide I don’t need this much in my Lightning wallet so I move 0.055 BTC into a new Lightning address. I then close this new Lightning address with 0.055 BTC and send the funds to my regular Bitcoin wallet for a fee of 500 satoshi. Current balance 1.004985 BTC in regular Bitcoin wallet and 0.0138984325 BTC in Lightning wallet. This takes about 30 minutes to get the 3 confirmations that show the transaction is virtually impossible to reverse.So the cost of the 2 transactions from the regular Bitcoin wallet totaled 1500 satoshi. I like to think that these satoshi were well spent as they are paying for the security of the Bitcoin network. While the 5 Lightning Network payment transactions cost a total of 156.75 satoshi.It is important to note that the Lightning Network does not replace the traditional payments from a regular Bitcoin wallet to another regular Bitcoin wallet if that’s how you want to send your BTC. The Lightning Network runs on top of the Bitcoin network and does not interfere with the traditional Bitcoin transactions. via /r/Bitcoin http://bit.ly/2r9qVxC

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