Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

The Lightning Network: Turning Bitcoin into Money

papers.ssrn.com

Post reply on HN
Print view View original

41–50 of 448 posts

Re: The Lightning Network: Turning Bitcoin into Money

#41

Post by TekMol »

teekert wrote: post #35
TekMol wrote: post #32

Earlier quoted context omitted.

How do you handle the tax implications of streaming sats? As far as I know, every payment with Bitcoin triggers a taxable event? Do you record a gazillion log entrys "Paid $0.0000145 for listening podcasts, Paid $0.000142 for listening podcasts ...", crunch all the numbers and then at the end of the year put that gigantic list into your tax declaration?

I'm not on the receiving end, but to me this seems like the law is behind reality. Micropayments are coming, perhaps using blockchain, perhaps not, probably in a number of different ways. I guess this is a good question for the hosts of the podcasts that use these features (Like Linux Unplugged, and other shows from Jupiter Broadcasting or the No Agenda show by Adam Curry and John Dvorak.) Perhaps this is not answere…

In the US and other countries I have heard about, it applies to the sender also.

If you buy Bitcoin for $X and then buy something with those Bitcoin, then you have to record the "fair value" $Y of that something and pay taxes on $Y-$X. On the amount that your "Bitcoin speculation" has earned you.

Looks like in the Netherland, it is different indeed. Making it much easier to use Bitcoin.

Re: The Lightning Network: Turning Bitcoin into Money

#42

Post by nailer »

jstanley wrote: post #8
nailer wrote: post #6

Is lightning just another layer 2 scaling solution? Or am I missing something?

Isn't lightning the layer 2 scaling solution? What other promising options are there?

> What other promising options are there?

Fast layer 1s.

That way I don't have to worry about integration between n layer 2s that my users are on (considering my users are unlikely to be on the same layer 2).

Re: The Lightning Network: Turning Bitcoin into Money

#43

Post by shudza »

sshine wrote: post #3
giuliomagnifico wrote: post #2

Interesting paper, surely the LN is miking the Bitcoin more useful as a payment/money system.

It seems really useful for people who are already making Bitcoin transactions. I'm not sure I see it function as a tool for increasing adoption, though. Anyone can send someone Bitcoin by asking them to install a wallet (or giving them a paper wallet). The story seems less simple if those were sent with Lightning. Maybe that's just a question of wallet support not being pervasive. One nice property of money is that y…

Try being a merchant and not using third party custodial services (Paypal) to accept payments on your website.

Re: The Lightning Network: Turning Bitcoin into Money

#44

Post by DennisP »

One drawback of Lightning is that if you want to receive funds, and you don't have a direct channel to the payer, then you have to be online. It's an interactive protocol, you can't just publish an address and check it later. Since most people don't run their own servers, LN is pretty much going to be a custodial system.

Re: The Lightning Network: Turning Bitcoin into Money

#45

Post by plankers »

alchemist1e9 wrote: post #28
arcticbull wrote: post #21

Earlier quoted context omitted.

Again, please specify exact quantities, I did, it's the least you can do. > But sure, you can stick to the traditional monetary system where only a select few control the rules. No, a body accountable to Congress (the Fed) which publishes quarterly audits is responsible for the currency. They act on behalf of the American people. As opposed to an un-elected, un-accountable cluster of core contributors and mining pool…

You seem to have a very US centric worldview. Maybe ask some Turkish savers how they feel, or any number of endless examples worldwide where saving in their own government fiat isn’t a good idea.

you can bet your bottom dollar there are some nerds in Sri Lanka who are very happy to own bitcoin right now. they'll be able to spend it as soon as the electricity comes back up.

Re: The Lightning Network: Turning Bitcoin into Money

#46

Post by joosters »

once_inc wrote: post #14
shp0ngle wrote: post #11

Lightning Network is just around the corner for about 5 years now

It is being actively used daily by a vast community of users. I don't understand what you are trying to imply with your statement.

The 'reference' implementation of the protocol, https://github.com/lightningnetwork/lnd is still in beta, with warnings about how users could lose all their money. AFAIK, there's no stable/reliable software out there.

And don't forget, ordinary users need to monitor the blockchain 24/7 in order not to lose their money by a counterparty closing their channel fraudulently.

It's far from ready for use.

Re: The Lightning Network: Turning Bitcoin into Money

#47

Post by Hamuko »

once_inc wrote: post #13
blueflow wrote: post #12

Does this imply an admission that Bitcoin itself is not usable as money?

What do you think is being exchanged on the Lightning Network? LN transactions are simply 2-of-2 multisig transactions made on-chain, where both parties can change the balance amongst themselves, and where settlement is possible at any moment. Bitcoin isn't being used as money on-chain. Why is this controversial? Bitcoin is the equivalent of gold, which was the hardest form of money that is accepted worldwide, before…

>Bitcoin is the equivalent of gold

That definitely wasn't the original goal of Bitcoin though.

Re: The Lightning Network: Turning Bitcoin into Money

#48

Post by TekMol »

DennisP wrote: post #44

One drawback of Lightning is that if you want to receive funds, and you don't have a direct channel to the payer, then you have to be online. It's an interactive protocol, you can't just publish an address and check it later. Since most people don't run their own servers, LN is pretty much going to be a custodial system.

If you have a lightning channel to the custodial service you use, you can transfer the funds to yourself any time though.

So in contrast to a fiat bank, where you keep your funds permanently, you could use a "lightning bank" just to hold last nights payments and transfer them to yourself every morning. Or you automate the withdrawl to take place every hour.

And: Couldn't your phone be your server? The way I understand LN, receiving funds just means to exchange a few bytes of data. Can't phone apps receive push messages?

Re: The Lightning Network: Turning Bitcoin into Money

#49

Post by protonbob »

TekMol wrote: post #32
teekert wrote: post #5

A cool use of the Lightning network is the podcast 2.0 initative. Currently, as I listen to podcasts, I stream back satoshis (sats), value for value (I use Castamatic on iOS, fountain.fm is also an option on Android). You can also send messages with sats attached, called “boosts”. Creators can transparantly split the sats they receive over various goals (i.e. FOSS projects [opensats], or guests on shows). There are n…

How do you handle the tax implications of streaming sats? As far as I know, every payment with Bitcoin triggers a taxable event? Do you record a gazillion log entrys "Paid $0.0000145 for listening podcasts, Paid $0.000142 for listening podcasts ...", crunch all the numbers and then at the end of the year put that gigantic list into your tax declaration?

I think this is one of those circumstances where you just don't tell the IRS. Just like running a garage sale or a lemonade stand.

Re: The Lightning Network: Turning Bitcoin into Money

#50

Post by shudza »

arcticbull wrote: post #9

Lightning is a solution that does not do what it says on the tin. It requires an on-chain transaction to open a channel, which at current block size limits requires about 75 years for everyone on earth to have one, and somewhere in the trillion dollar range in fees and the entire outstanding block reward. Factor in quadratic routing complexity, and even if you did onboard everyone it wouldn't work anyways. This is as…

Some interesting points. IMHO, LN is far from THE solution. But it will help merchant adoption, more than end-user though.

The fact is, most people would/will probably use custodial LN wallets, which is against some "crypto" postulates, and comes down to well known MySQL argument.

The difference is MySQL on Bitcoin vs MySQL on USD (Paypal). As we will see in the coming months, fiat itself is a lot like a MySQL.

So I would argue that there is nothing wrong with MySQL on Bitcoin, and in fact, is an upgrade on fiat.

Post reply on HN