Eltoo-LN made better
The eltoo proposal will make Lightning Network have improved functionality.
For you to understand how, first you will have to understand how LN channels work:
With the Lightning Network, users can transact via what are called payment channels. These channels allow parties to make an unlimited number of transactions between themselves for a specified period of time without broadcasting them to the bitcoin blockchain. When the parties are finished, they close the channel by transmitting the final updated status of the channel balance back to the main chain.
But what if a Lightning user tries to cheat their counterparty by broadcasting an outdated channel balance which would pay them more than they are due? Lightning solves this by penalizing users who attempt to cheat by giving all of the funds they have open in the channel to the other party.
The problem is that the broadcasting of old balances is not always a cheating attempt. There are a number of scenarios in which users can accidentally broadcast an older balance; for example, because of a software bug or a backup gone wrong. In such scenarios, a complete loss of channel funds is quite a heavy punishment.
Eltoo updates a channel by building a chain of time-locked transactions, where each transaction spends funds from the previous one to reflect the latest channel balance.
This is basically making the use of watchtower less important.
Eltoo continually updates payment channel balances by recording all the transactions, and then, at the time of settlement, allowing the intermediate states to be skipped so that only the last settlement transaction is confirmed to the blockchain. If one party tries to cheat by presenting an outdated transaction during settlement, the other side is given some time to transmit the latest transactions and thus ensure the accuracy of the channel balance.
This is a type of type of hierarchy in these types of transactions: any newer transaction can override any older transaction without requiring that all transactions in the entire chain be broadcast.
However, in order for eltoo to work on the Bitcoin network, a change to the Bitcoin protocol itself is necessary: the introduction of the SIGHASH_NOINPUT flag to signatures. This could be done via a soft fork, and the authors of the paper included a proposal to do so.
This works by constantly sending info to the opt code until the finalization sign is given closing the channel and recording it on chain. This is kinda works like smart contract where data is sent between until agreement is reached. In fact opt code is how Bch plans on getting its own version of smart contracts.
Also Bitcoin does have smart contract with scale being better than Eth using RSK.
You can read more about the rsk platform here:
https://steemit.com/bitcoin/@sames/bitcoin-s-ethereum-killer-rsk-co
You can read an extended scaling plan as well:
https://steemit.com/bitcoin/@sames/how-rsk-is-going-to-use-sharding
Info from:
https://bitnewsbot.com/blockstreams-proposed-eltoo-for-lightning-network-would-change-bitcoin-protocol/
https://bitcoinmagazine.com/articles/future-bitcoin-what-lightning-could-look/
For me LN to become mainstream adopted should work without users even now that they are sending bitcoin with LN. These are all small steps until we reach that point.
yep
And again an educational post! Keep them coming @sames. You will come to a point where I do understand all of it! How great would that be!
Ouch, what part do you need explanations in? I will be happy to give it you :)
Mostly all of it 😂
But just keep on writing those articles because I do like them!
lol I wish I could make it simpler but it kind hard too :(
But here a superduper simplified exp of the post. First you need to know the LN is basically kinda like a giant smart contract not stored on a chain. The chain gives the LN value and security. The eltoo is basically sending the main chain signs of balance between channels in a type of tech know as opt codes. Only the last part of the channel is officially confirmed and stored on the main chain by just "clicking the send" button.
This prevents fraud of LN :)
I would recommend to understand the LN is to watch the video on my scaling post about LN it will help alot :)
Thx I will
BOOM! good improvements ahead!
yep
This will be a mess to explain to the public i hope the LN will be one of those things super hard to explain but when put in practice everything just clicks and it becomes obvious how it works.
Well the tech just sounds hard but in reality most when notice it bc their wallet does it for them. It just the code explanation that sound hard. It like how steem code and other coin code is harder but easy to use and getting better. also look at fullcoverbetting comment i made an easier explanation :)
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