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The Lightning Network: Turning Bitcoin into Money

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Re: The Lightning Network: Turning Bitcoin into Money

#331

Post by olalonde »

kkielhofner wrote: post #327
olalonde wrote: post #317

Earlier quoted context omitted.

Bitcoin is not a concrete product like Google Search or a smartphone. It's more of an idea, like free speech. The idea being money without a central authority, something that has never really existed before (digitally, at least). No one woke up one day and thought "WOW I need democracy" or "WOW I need free speech". It's abstract and doesn't gratify immediately. The average person does not even have a conception that…

I use these examples in layers (I have a networking background so my mind more or less thinks in OSI layers). For actual products bitcoin (and blockchains like Ethereum with EVM) are the fundamental enabling layer. I like to think of them somewhat akin to TCP/IP or even HTTP. Where are the higher layer applications and use cases built on blockchain with instant and obvious utility to the average person walking down t…

I agree that the Internet's utility is more obvious than Bitcoin. Bitcoin has little or even negative value to authoritarians. Even in more liberal countries, financial sovereignty and privacy are not generally viewed as important. But to me, this is just more reason to believe that the pace of adoption will be slow and gradual.

Re: The Lightning Network: Turning Bitcoin into Money

#332

Post by dmitriid »

Centmo wrote: post #182
dmitriid wrote: post #177

Earlier quoted context omitted.

> The 1.5-3.5% credit card processing fee for starters. Compared to... 1 dollar, no, 15 dollars, no, 5 dollars, no, 65 dollars, no, ... transaction fees for Bitcoin.

How much are Lightning transaction fees?

Same. Lightning gets around them by bunching a bunch of transactions into one bitcoin transaction. Which is exactly what people have been doing with card processing for ages now.

And of course there other payment systems around the world that don't rely on card transactions.

And don't forget that the entire lightning thing is dependent on banks aka nodes with large sums of money to provide liquidity in the system.

Re: The Lightning Network: Turning Bitcoin into Money

#333

Post by simonmales »

lxgr wrote: post #215
simonmales wrote: post #201

Earlier quoted context omitted.

Not exactly. Lightning means they receiver gets 100% what I send. This is particularly interesting for micropayments. I can tip someone 1 cent, or less with no middle man.

What's the incentive for anybody to open a lightning channel, providing connetivity etc. without compensation? And even if all of this was indeed done for free (sustainably, not as a loss leader): Dispute resolution and fraud costs money. Free leaves zero margin for either, and I wouldn't use a payment service not providing both.

Peers don't need to have channels open to each other to exchange satoshis.

As long you have some channels open and I have some channels open, the network will route my payment to you.

As sender, I am responsible for any potential routing fees. You as the payee are not.

If we were to transact with each other often, it could be worth opening a dedicated channel to enhance privacy and avoid routing fees.

Re: The Lightning Network: Turning Bitcoin into Money

#334

Post by simonmales »

shmatt wrote: post #209
simonmales wrote: post #201

Earlier quoted context omitted.

Not exactly. Lightning means they receiver gets 100% what I send. This is particularly interesting for micropayments. I can tip someone 1 cent, or less with no middle man.

the fact you are using the lightning network means there is some thing writing down a transaction from wallet a to wallet b smart contracts are a middle man, and not a great one from all the recent exploits executed on them

If I were to send you satoshis via lightning. It wouldn't be recorded in the Bitcoin blockchain.

Re: The Lightning Network: Turning Bitcoin into Money

#335

Post by ALittleLight »

nwiswell wrote: post #316
kkielhofner wrote: post #289

When will the blockchain ecosystem provide something with that "WOW I need this in my life right now" factor to the average user? Google went from a research project to incorporated and usable on the internet in roughly two years with a total investment of about $2mm in 2022 money. Let's just say the pace of innovation had some serious roadblocks at the time (they literally had to build their own servers and host the…

Broadly I agree with the argument that crypto is taking an awful long time to come up with the killer app, but this is not a fair analysis. Let's be clear: when Google exploded, that was the growth of the Internet in the driver's seat, not demand for Google specifically. Google's growth was a side effect of the exponential growth of the internet because it solved a need where there was no adequate incumbent solution,…

I think this is less about growth factor and more about "killer app". The killer application of Google is that it actually finds what you are searching for really well (well, it did). That's what set Google apart from other search engines. The killer feature of crypto is...?

DAOs, NFTs, smart contracts, random tokens all seem less like good features and more like transparent scams or terrible ideas that don't work. It's fine if adoption is slow - but there should actually be something beyond Ponzi schemers and hackers stealing from each other. Drugs and tax evasion, sure, but how far does that take you?

Re: The Lightning Network: Turning Bitcoin into Money

#336

Post by dmitriid »

shudza wrote: post #283
dmitriid wrote: post #184

Earlier quoted context omitted.

> But it will help merchant adoption, more than end-user though. So, merchants will adopt it but users won't? So why would merchants want to adopt it?

Users will use "custodial LN". Which you could argue is not LN, but MySQL, L3, whatever, but merchants will still get their payments on L2

How exactly are users going to use MySQL?

Re: The Lightning Network: Turning Bitcoin into Money

#337

Post by dmitriid »

olalonde wrote: post #192
dmitriid wrote: post #189

Earlier quoted context omitted.

> where the "trustful" systems are built on trustless foundations. You cannot build trust on a trustless foundation. As, again, the crypto world is busy rediscovering.

What do you mean by that? I don't see why there couldn't be a centralized service offering payment dispute arbitration on top of Bitcoin (this is what I meant by building "trustful" systems being built on top of trustless foundations).

> why there couldn't be a centralized service offering payment dispute arbitration on top of Bitcoin

What exactly does Bitcoin provide in this case?

> this is what I meant by building "trustful" systems being built on top of trustless foundations

So, a service that exists outside bitcoin, has a trust system built entirely outside bitcoin and only doing something with bitcoin because reasons... is "building trustful systems on top of trustless systems".

I don't think you know what "building on top" means.

Edit: grammar and mobile typos

Re: The Lightning Network: Turning Bitcoin into Money

#338

Post by adamrezich »

CharlesW wrote: post #328
adamrezich wrote: post #187

Earlier quoted context omitted.

why should content creators have to go through a centralized website like Patreon in order to get value from their consumers, giving Patreon a cut in the process? sure it's (for now) more straightforward for end-users, but as a content creator you're locking yourself into the Patreon Platform, you're building (at least some subset of) your content and your business around it being specifically "Patreon content". I'm…

> why should content creators have to go through a centralized website like Patreon in order to get value from their consumers, giving Patreon a cut in the process? sure it's (for now) more straightforward for end-users… You answered your own question, but there's also no reason to use a "centralized website" (i.e. a 3rd-party service) if it doesn't add value. You just handle the subs yourself and provide a unique fe…

sure, if you want your podcast's business model to be "you must pay to access this content." it has been argued that this is not the best business model for a podcast, as you're either locking out your entire audience until they decide to start paying, or if you go for the "regular podcast is free but Paid Members get access to additional content" model, then you're producing content that only a fraction of your audience gets to experience. if you're doing a weekly show with an additional bonus paid weekly show, this can lead to situations where something is discussed at length on the the bonus paid show, and then referenced on the free show, leaving unpaid members in the dark as to wtf you're talking about.

this is the traditional model of subscription-based content, but Podcasting 2.0 is based upon the "value-for-value" idea, where listeners are encouraged to willingly give money to support the show, possibly in exchange for a shout-out (akin to YouTube "Superchats") or something like that. the model sounds unintuitive, but it has sustained No Agenda since the late '00s, and other shows as well.

another podcast I tune into every week and love does the Patreon thing. they do a free, public weekly show, and an additional bonus show only for paid Patreon subscribers. I pay them through Patreon (who takes a cut) for the privilege of accessing a link to an unlisted YouTube video each week to watch the bonus show (which they explicitly refer to as a "bonus Patreon podcast" in the show itself! why intertwine your brand with Patreon like this?!). each week the bonus show gets less than 100 views, yet the cohosts go out of their way to record an additional 30-40 minute show just for these under-100 viewers. this does not seem like a sound business strategy to me compared to value-for-value.

Re: The Lightning Network: Turning Bitcoin into Money

#339

Post by ABeeSea »

toolz wrote: post #212
ABeeSea wrote: post #175

Earlier quoted context omitted.

They have to be smuggled INTO another country. One that has applied sanctions and doesn’t want Iran’s fruits and nuts. Violating import laws especially for agricultural products is a big deal.

no country _wants_ to reduce trade - they simply accept that sanctions are necessary. Reducing trade necessarily hurts both countries, and there aren't likely to be any functioning developed countries that want to act against their own interests. As such, it's not at all hard to imagine the receivers having a hard time enforcing sanctions. After all, with all the problems a country has - why would they dedicate time…

If the countries wanted to accept the fruits and nuts, they wouldn’t need bitcoin for payments. They would do the usual trade processes. They have outlawed imports from Iran and bitcoin doesn’t change the fact that circumventing agricultural import laws is a massive crime.

Re: The Lightning Network: Turning Bitcoin into Money

#340

Post by kkielhofner »

nwiswell wrote: post #316
kkielhofner wrote: post #289

When will the blockchain ecosystem provide something with that "WOW I need this in my life right now" factor to the average user? Google went from a research project to incorporated and usable on the internet in roughly two years with a total investment of about $2mm in 2022 money. Let's just say the pace of innovation had some serious roadblocks at the time (they literally had to build their own servers and host the…

Broadly I agree with the argument that crypto is taking an awful long time to come up with the killer app, but this is not a fair analysis. Let's be clear: when Google exploded, that was the growth of the Internet in the driver's seat, not demand for Google specifically. Google's growth was a side effect of the exponential growth of the internet because it solved a need where there was no adequate incumbent solution,…

The DuckDuckGo comparison is a perfect one. The average user has demonstrated they do not care about whatever creepy/evil thing Google is doing that we talk about here. They just want to lookup the hours of a restaurant as quickly, reliably, and easily as possible so they can eat and move on with their lives. Ditto use cases for Twitter, Facebook, etc, etc.

Why (and when) will average users suddenly care "because blockchain"? They don't and won't (the usage numbers reflect this). They just want to get an answer to a question in seconds, Tweet their musings, endlessly scroll pictures on Facebook/Instagram/etc, or watch Youtube videos of cats, glitter bombs, or whatever. For free. As ridiculous as it is to me and most of HN the average person is even willing to have their TV and streaming services show them endless ads. They just like that they bought that 60" TV for $400 on Black Friday.

Even the censorship/de-platforming argument falls flat. It's been demonstrated that people (as a whole), going back to our tribal roots, prefer to engage with like-minded others. It is fundamental human nature and there have been multiple studies conducted that show it's wired in to our reward circuitry.

Trump gets booted off Twitter? Enter Truth, Parler, whatever where many millions of users moved in near record time. When it comes down to it people like echo chambers and they like free. Platform for free speech? Create a Truth account and start wandering in to flame wars that go against the political leanings there. You will get booted just as Trump got booted from Twitter.

This is where I think blockchain and lack of censorship is also fundamentally flawed. They don't want to pay XYZ in some random coin to make a social media post. They also don't want to bump in to child pornography or some other universally objectionable content (in the case of true to the mantra decentralized blockchain platforms without any form of "censorship").

The same argument goes for money. Almost no one cares - they want to swipe their credit card a few times a day and move on with their lives. They do not care about transaction fees, final settlement times, etc. It's invisible. Other than credit cards and cash the average person interacts with more complicated levels of the financial and banking systems a few times in their lives. They do not care if a lifetime of home ownership (as one example) cost them $50 in wire fees. They likely have no idea (and again don't care) how the 401(k) their employer set them up with actually works.

They also don't want to discover that their wallet has been hacked, their exchange collapsed, the value of their money dropped 20% overnight, or any of the other number of ways funds go "poof" with blockchain.

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