TheDesertLynx on Nostr: People are starting to give up on Bitcoin's Lightning Network. It's too clunky, ...

People are starting to give up on Bitcoin's Lightning Network. It's too clunky, complicated, and difficult to use to work for regular people. 😵‍💫 But if it doesn't work for regular people, what does it work for? Great question!

First, before maxis cry FUD, just do a cursory look around Twitter. Ignore people who don't care about Bitcoin. Prominent maxis are acknowledging the truth that, from the end-user perspective, it's difficult to use, even many years post-inception.

What about Lightning's structure makes it clunky? 🤔

-Channel maintenance
-Liquidity management
-Always-on connectivity
-Finding routes

Contrast this with on-chain, where you connect to a node (or run your own) and are all ready to go. Only companies will manage Lightning.

So then what is Lightning good for?

-High bi-directional (not one-way) volume
-Low per-transfer fees
-Instant transfers

Entities that do a ton of back-and-forth transfers with a small number of partners can afford to run and manage a node, and it can make sense to. Who might some of these entities be?

-Exchanges
-Custodial payment processors
-Social media networks offering tipping
-Games
-Payroll companies offering real-time streaming salary (settle anytime you need)

Lots of use cases that don't involve the end user buying coffee! ☕️

But wait, wasn't Lightning supposed to be for buying coffee? 🤨If it doesn't work well for p2p payments, where does that leave Bitcoin?! First, Lightning can take enough transactions off-chain so more people can do on-chain payments. Not enough, but it's a start. ltimately, either a general-purpose L2 solution like the drivechains Paul Sztorc is proposing would be needed at scale. I personally thing we need a block size increase, even to make Lightning work better. Doesn't have to be big blocks, just bigger. Double every halving.

NOTE!!! This only applies to Bitcoin. Lots of other coins have pursued on-chain scaling strategies, and can handle lots of layer-one payments cheaply. I use Dash the most, but Bitcoin Cash, Litecoin, even Monero work. I'm purely speaking to the people who ONLY want Bitcoin.