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In the future, when Bitcoin layer 1 fees become too expensive for the average person and are only financially justifiable for large companies and banks, am I correct in my understanding that newcomers will still be able to open a wallet and receive and transfer funds directly on the Lightning Network (layer 2) without ever needing to settle or fund a layer 1 wallet?

That’s how it scales without necessarily involving counterparty risk, right?

#Bitcoin #LightningNetwork #BTC #Scaling #BitcoinScaling #Layer2

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Discussion

JoJ 1y ago

If they are using a custodial lightning wallet- yes

A non custodial lightning wallet will still need an on chain transaction to open the channel

penglunds 1y ago

Got it! So, an employer, at that point, would likely either run their own node or collaborate with another company that does, enabling them to pay a newcomer to the job market using a custodial Lightning wallet.

If the employee wanted to move their salary, they could freely transfer funds to other custodial Layer 2 wallets. However, they wouldn’t be able to take self-custody without settling on Layer 1.

Furthermore, a group of individuals who don’t trust any custodial options could theoretically crowdfund a Layer 1 fee and open their own Lightning node that they can use. Is that correct?

penglunds 1y ago

Got it! So, at that point, an employer would likely either run their own node or collaborate with another company that does, enabling them to pay a newcomer to the job market using a custodial Lightning wallet.

If the employee wanted to move their salary, they could freely transfer funds to other custodial Layer 2 wallets. However, they wouldn’t be able to take self-custody without settling on Layer 1?

Additionally, a group of individuals who don’t trust any custodial options could theoretically crowdfund a Layer 1 fee and open their own Lightning node. Is that correct?