Nostr Web Client

A channel in Lightning is just an on-chain UTXO owned by two entities who have to agree how the UTXO will be spent. Lightning transactions using the channel are just updates to the agreement between those two owners about who will get funds from the UTXO when the channel is closed.

maven leo 9mo ago

I suppose lightning transactions initiate smart contracts

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Discussion

Dikaios1517 9mo ago

Yes. Lightning channels are smart contracts on Bitcoin in a 2:2 multisig.

maven leo 9mo ago

Multisig means both parties must sign the transaction before the UTXO is spent?

Dikaios1517 9mo ago

Indeed, and they do so every time a Lightning transaction occurs on the channel, they just don't broadcast that transaction to the blockchain unless and until they want to close the channel.

maven leo 9mo ago

And 2:2?

maven leo 9mo ago

I got this. 2 keys are needed

maven leo 9mo ago

Thanks, buddy!