Re: [bitcoin-dev] What Lightning Is

[Joseph Poon <joseph@lightning.network>]

Hi Hector,

On Sun, Aug 09, 2015 at 09:48:41PM +0100, Hector Chu via bitcoin-dev wrote:
> Is the Lightning system limited in the number of hops there can be in
> the payment channel? I am looking at the initial Lightning slides
> presented in February and it looks like the locktime decrements by
> 1-day along each hop. So the more hops there are the longer my
> bitcoins are potentially locked up for?

The hops are limited to the time-value which the sender wishes to pay
and the minimum acceptable timeout between each hop. It should be
relatively cheap if you game it out, though (I don't forsee me opening a
1 BTC channel and being able to make $5 per month...)

1-day is used as a convenience. However, the time between hops should be
somewhat long, as the intermediate steps can be extended further when
you want to offload the HTLCs to others who have a channel open with
both counterparties. E.g. Alice sends a payment to Dave through Bob and
Carol. Bob has a channel with Carol and has an HTLC with it, but that
channel seems to be used a lot. Erin has a relationship to both Bob and
Carol, she can offload the payment so that the payment actually goes to
A->B->E->C->D. B<->C is now completely clear.

> > On Aug 9, 2015 1:15 PM, "Hector Chu" <hectorchu@gmail.com> wrote:
> >> In the Lightning network it is assumed that the balances can always
> >> be settled on the blockchain if any of the parties along the
> >> channel has a problem. What if the fee on the settlement
> >> transactions is not high enough to enter the blockchain? You can't
> >> do replace-by-fee after the fact. Do the fees always have to assume
> >> worst case scenarios on the Bitcoin fee market?

How do you send coins if you wanted to send funds below the current
IsStandard value? It should be no different. If your wallet can't send
funds below the IsStandard value on-chain today, then I don't think it
should be able to to in the future, right? If you send funds *at* the
minimum IsStandard value today, you're probably paying really high fees,
this is a problem that exists today.

-- 
Joseph Poon