My first experience ever with BITCOINS’s LIGHTNING NETWORK – PAINS and GLORY!
Hello my fellow Steemians and Crypto investors,
As promised yesterday on my post Just opened my first Lightning Network channel with Eclair! I will be recounting today my adventures and first ever experiences paying for stuff on the internet with the Lightning Network.
Bear with me, there will be a lot of screenshots, some pain, but ultimately glory!
Downloading Eclair and opening my first channel
First, I downloaded the Eclair Lightning Network mainnet wallet for Android. I had already played a bit on the Testnet version of Eclair but this time I wanted to buy something for real, put some skin in the game and be a man! :)
After downloading the app you will have to go through the somewhat bothersome process of writing down a 24 word seed phrase that will serve as a backup to your wallet in case you lose your phone or want to install the app on a new one.
You'll also have to create a 6 digit pin number to be able to use the app. Write both down on a piece of paper and keep them in a safe location.
In the first screen of the app you will see a newly generated Bitcoin address that you can use to fund your channel(s). So, I went ahead and funded this address with a little bit of BTC to open my first channel.
At this point you will have to wait for the funding transaction to happen on the Bitcoin network and pay the regular fees. There's no escape to this when opening a channel.
On this screen you can paste a known lightning node address, or just select the default node by ACINQ (the company behind the app).
In the future however, I foresee that, to reduce costs and hassle on consumers, major players (big companies) will open channels and let their customers use them, just like exchanges do now with their Bitcoin pooled addresses. Most regular people will never have to go through this step.
This is where Bitcoin Cash shills will scream "centralization!" but hey, wake up already, the world is not perfect, it will never will be. This is still much more decentralized than what we have today and way more accessible to the un-banked of the world.
Also, big blocks would be even worse! Only big companies would be able to afford the huge overhead costs of gigabyte or terabyte blocks and the superfast fiber optic internet speeds that would be needed to transmit them on time, if that's even possible at all (let's discuss on the comments below if you disagree).
My first Lightning Network channel opened!
Let's buy something!
Ok, so far so good, let's buy something now that we have a funded channel. Well, not so fast, at this point in time there aren't many options yet. So I went to https://lnroute.com/ where they list available services you can use right now.
My main objective was to test micro-payments (anything under $1). Also, I didn't want to risk too much money on this newly released network and I advise you shouldn't either.
I have been paying with Bitcoin and crypto currencies for a while now but mostly amounts over $20. Micropayments is the most exciting part for me because it's something credit card companies and banks don't have a real solution to. This will be the really disruptive part of the Lightning Network!
I went to mainnet.yalls.org, a social networking and blogging platform to create my first post paid with a 12 cent LN micropayment!
Following is the post I created:
I wrote my post for posterity! History was being made!
I copied the Y'alls payment request into the app, all was working fine but then...
The payment failed! Shoot!
The payment failed, no matter how many times I tried it. I did a little bit of research online and it turns out this is an issue that has been reported at the Github repository for the Eclair Wallet. I'm not sure it is a problem with the Eclair Wallet, Y'Alls or LN itself but they are working on it so, let's move on until they fix it.
This goes to show we are still treading new waters, there will be pain in the beginning. As a software developer myself I can tell you I have never seen software that works fine the first time so no surprise here...
Using Bitrefill's LN payment option
I still had a channel opened and the locked funds were intact, nothing was lost. So, I went back to https://lnroute.com/ to see what other services I could use to test LN. Most turned out to be over $10. Some cool t-shirts, Paintings, VPN services etc.
The T-shirts by hodlmonkey.com were really cool! I guess I'll have to add some funds to a new channel to get me one of those later but, for now, my thing was to test small payments.
I decided then the next best option would be Bitrefill.com, a service that allows LN payments for cellphone recharges all over the world for as little as $5. Not only would I be able to test small payments but also I would support a fellow Cuban developer that's been helping me with the Crypto Millionaire app with, an always welcome, phone recharge so it was perfect!
Selecting Bitcoin LN payment for a cellphone recharge at Bitrefill.com
I scanned the QR code provided by Bitrefill.com from the Eclair app and clicked Pay. the transaction was successful this time and super fast, so fast I couldn't grab the green Success screen!
Confirmation of payment to Bitrefill.com. The extra 33 cents are mostly due to the conversion to CUC (Cuban convertible pesos). The LN was so small (0.000000074 BTC) that most online converters just report it as zero USD ;)
The Final Verdict
There was some expected pain. I wasn't really able to test micropayments, my main objective with this test but I understand, as a developer myself, that most young software is bound to have bugs that will be ironed out with time.
Eventually I did manage to send a small payment, not really a "micro" one as I expected, but it was really cool how fast it worked!
I foresee LN will be likely mostly used in the future for most small and micro payments while the main Bitcoin network will be used for payments over $1000 USD because of the greater security it brings for which high fees are worth it.
Second layer solutions will be the future of crypto currencies, not only for Bitcoin, but also for Litecoin, Ethereum and even Ripple. It's just the natural way of things. The Internet evolved in a similar way, coming up with Network Address Translation (NAT) as a second layer solution to routing issues and IP addresses running out.
In some ways Lightning Network reminds me of the early Internet, it eventually works, but you’d have to go through a lot of technical hoops just to send a simple email.
Things have changed so much! Right? Now small children and their grandmas send emails all the time. With a swipe of their finger they can contact anyone, anywhere in the entire world in seconds. It's still amazing when you think about it! Well, the same thing is happening with payments, it’s only a matter of time now.
I can see the infrastructure being built and how pretty soon we’ll be sending and receiving micropayments over the internet without even realizing it. Mark my words. It’s coming!
Hope you like and resteem this post! Also, please share your experiences with LN.
Meme generated at imgflip.com/memegenerator
Meme generated at imgflip.com/memegenerator
So, have you used the Lightning Network yet? What particular software did you use, what did you buy? How was the experience?
Do you have other exciting apps and tools you want to share with the community of crypto investors?
Do share your thoughts on this post with the Steemit community in the comments below!
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This is the best article I've read on lightning network. I need to learn more about it. Do you feel there will be any advantages or disadvantages of using bitcoin vs litecoin on the LN?
Hi @realestatecoach,
I believe Bitcoin and Litecoin will be interchangeable though atomic swaps. Bitcoin will be used in a similar way to Gold (for large transfers and wealth storage), Litecoin like silver and Lightning Network and other second layer solutions will be used for day to day transactions. The Internet will look very different, most good content on it will be accessible through micropayments, not through ads and selling of your private info like today.
This is a very insightful post about Lightning Network and we strongly believe that the Lightning Network has the potential to save Bitcoin from its scalability issues. It might interest you to try Blockbasis where users can send and receive cryptocurrency with just an email. Let us know what you think. We are constantly updating our platform based on user feedback, so we welcome any and all thoughts!
Wish I could up vote this more than once. Or that my vote was worth something.
This is the kind of content the showcases the potential of Steemit. Time and effort went into this and it provides information useful to the crypto community.
Well done!
As for the lightening network itself, I think it's a step in the right direction, regardless of the centralization/decentralization controversies. At some point ideology has to give way to what actually works because in the end we all have to get things done.
Thanks @bobcastleman, always nice to hear smart comments around here! You got a new follower. regards
Andreas Antonopoulos once said that cryptocurrency will conquer the world faster than mobiles did. And I see this happening as it looks like just yesterday LN was just an idea.
Is it possible that the first payment was too small and the receiving nodes rejected it as a result?
I still think Doge is best for micropayments.
Very interesting thank you for sharing your experience with screen shots. Good job and good luck
This was very helpful. I have been trying to wrap my head around the lightning network and how it will function, and this article was very informative. It is exciting to see how this all play out going forward, you are probably right about layer 2 solutions being the future. As long as these innovations continue to work, I don't see bitcoin moving away from the top spot.
Thanks @bscrypto! You got a new follower. Thanks for the resteem too!
Another great report and exciting news! Do you think mainstream BTC wallets will start integrating it?
I totally agree with this statement and I love that there is a solution that is decentralized!
Coins mentioned in post:
Thanks for the article. Just started following you. Glad there are others here writing long form content for crypto. I'm doing the same. Keep up the work.
Thanks @quantalysus! I love writing about crypto! Following you back, always looking to learn new things and follow smart people. Regards
Thanks! If you ever want to collaborate let me know @cryptoeagle. I'm releasing two or three articles this week. Smart Media Tokens for one. Debating on Quarkchain, NKN, and nOS this week. Most of these projects are simply forks of DNA project. Bitcoin is still my favorite coin, the whole space is banking on its success as a store of value... Just my opinion.