Nostr

Welcome to nostr, and so that your first response is worthwhile, let me disagree with you!

In lightning, if you run your node software correctly, nobody can steal from you.

This means an offchain utxo settled in a lightning channel is "as good as" the utxo onchain, and thus both fall under the base money category.

However everything else, like account based (wallet of satoshi), ecash based (cashu, fedimint), sidechain based (liquid) has a third party (federated) custody model where you are at the full mercy of the custodian, this makes it fiduciary media, money warehouse banks with notes that are redeemable at par for base money (onchain or lightning).

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Fedimint is a shitcoin

No, it's the most groundbreaking money warehouse technology, ever.

A truly federated money warehouse wasn't even dreamed of a couple decades ago.

There’s nothing innovative about issuing IOUs.

Bitcoin, and multisig specifically, made federated custody of base money possible, that's a monumental breakthrough in 2012 or so.

Eric discovered an obscure cryptography paper that made federated blind signatures possible, that's fedimint 2021 or so.

Combine both, and you have a federated money warehouse with federated custody and federated anonymous IOU accounting.

Money warehouses have always been, and will continue to be, an ethical and useful service that entrepreneurs provide. These two tech breakthroughs just take it to the next level in terms of security and trust assumptions.

Fedimint transactions potentially both faster and cheaper than lightning transactions.

You do give up custody, so there is that.

But backed by Bitcoin, so no shitcoin!

What makes #Bitcoin special is that it is not backed. Bitcoin is the thing itself. This is true on Lightning as on main chain.

Everything else is an IOU, and thus shitcoin.

I'd still claim that the lightning-network is based on a form of IOUs and I love it regardless 🧡

In #Bitcoin, the token is the thing itself. This continues to be the case in Lightning, where channel-update transactions are themselves legit Bitcoin transactions. Nothing is owed. Neither channel participant is a creditor nor debtor of the other. It’s a peer-to-peer, electronic, cash system.

Problem is you have several competing channel-update transactions just hanging there until one of them is used and then it's a race where someone with a newer update-transaction can overrule the old, but only for a limited time period.

So the participants can be perceived as creditor or debitor of each other.

Haha thanks Max!

Perhaps you are right in the long run, but for now I think the definition of "run your lightning node software correctly" is too vague, cuz all sorts of details on how to keep your offchain utxo dry so to speak...

Like if you have a watchtower, then you don't want to SSH into it from the same machine as you SSH into your lightning node, cuz if you are hacked, chances are that the hacker got access to both node and watchtower(s).

Little things like that. And who runs a watchtower these days anyways 😏

#stillearly

Why is that categorically different to the technical challenges of securing an onchain singlesig utxo?

Like keeping the private key secret, running a node or wallet without back doors etc.

You oc has the challenge of keeping you keys safe, but you will have those challenges after settling a lightning channel anyways, so those evens out.

For a channel specifically you have something unsettled. That is, there can exist multiple unpublished txs in competition with each other. We use timelocks to try to favor one tx over the other.

I see it as a hare vs tortoise version of the double spend problem.

If the hare sleeps or it's house burns down and it looses its TX it looses the race to the tortoise.

Only when settled the Bitcoin is yours.