lightning network

Lightning Network Cannot Be Relied on For Effective Payment Processing

Lightning Network Cannot Be Relied on For Effective Payment Processing

According to a recent research that was conducted by Diar, it was shown that the likelihood of successfully routing a payment on the Lightening Network, bitcoin’s layer=2 micropayments solution, is considerably low. As a network that was designed to remedy issues of low scalability which is characteristic of the blockchain technology, the Lightning Network has played its role properly to a certain degree. So far, the Lightning Network has been able to ensure low cost, scalable and instant deals between two participants. As a result of this, it has enjoyed proper acceptance in the cryptocurrency community. Irrespective of the widespread acceptance that Lightning Network has enjoyed since its release in January, a couple of its flaws have been noticed. Let’s have a look at some of its flaws.

Lightning Network does not Comfortably Process Large Amounts

The research that was carried out by Diar reveals that the fund capability, as well as the number of nodes of the Lightning Network, has been on a steady rise. Regardless of this progress made, the likelihood of routing a payment successfully on its network is considerably low. Although this occurs irrespective of the amount that is involved, it is even more pronounced as the amount that is being transacted increases.

Each node on this network has up to four channels, with each channel having a capability of $20. As a result of this, the chances of a payment being successful with a few amounts of dollars are 70%. However, as the amount of dollars that is to be transacted increases, the chances of a successful payment go all the way down to 1%.

The Lightning Network requires all Participating Parties to be Present

The fact that a transaction on the Lightning Network cannot be successful in the absence of all participating parties is also a major flaw of this network. The implication of this is every party that is involved in a transaction on this network has to be online at the exact time of the transaction for the transaction to occur.

About Lightning Network

Lightning Network is a state channel project that helps in ensuring immediate payment on the blockchain network through the use of a smart contract. It features scalability, immediate payment, cross blockchains, and low cost of transaction. This network was first made use of on the 4th of January, 2018 by TorGuard, a VPN provider. Since then, this network has played a major role in helping fix issues of poor scalability on blockchain technology.

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