Being deployed at the beginning of this year, Lightning Network is highly anticipated to solve the blockchain scalability problem. And it seems that the first steps have been already made. Cheered by the crypto community, there took place allegedly the first operation on the Bitcoin Lightning Network’s primary network. According to reports, the transaction was extremely fast and did not drug fees into it.
New Era of Instant & Low-Cost Transactions?
For the past time, bitcoin has been significantly backlashed for the high transaction fees and long-waiting time. According to bitinfocharts.com, within the last three months of 2017 bitcoin median transaction fee displayed a rise from $1.5 in October to the fantastic pick of $34 on December 23, a day after bitcoin reached its record of $20,000 per unit. Currently, bitcoin median transaction fee fluctuates between $10 and $12.
Moreover, at the moment of writing, there were over 75,000 transactions waiting in the mempool. And even though it is quite an understandable phenomenon, as just at the beginning of the month there were over 175,000 operations in the queue, still it is not the result that lots of crypto enthusiasts expect from bitcoin. The problem is that the more people pile into BTC to use it as an asset rather than pay for goods with it, the network becomes more overloaded and its seems that nothing can be really changed.
However, there is hope and it could be strengthened by the Lightning Network. Two days ago, a Reddit user under the nickname btc_throwaway1337 informed about his fortunate transaction with the use of Lightning Network mainnet when he paid for a buy. The announcement was followed by over 1,500 Reddit users’ comments. The announcement was:
“I used Lightning Network’s mainnet (via lnd) to purchase an AR300M VPN Router through TorGuard, and it’s here! This may have been the first ever physical purchase on LN.”
Depicting the first experience of such an operation, the user btc_throwaway1337 said that it was very fast, simple, and, most importantly, he was not charged any fees.
“I’m just your average BTC enthusiast, who had a bit of extra time last weekend. I saw TorGuard’s tweet, so I decided to contact them. I enquired as to purchasing more than just a monthly subscription, their staff gave me LN peering information, I opened a channel, received an invoice, and here we are!” also added the user.
TorGuard, the company, from which he made a purchase, cheered the client in the official Twitter, suggesting it could have been the first such experience ever:
As the evidence of the transaction, the user revealed the transaction data, available on Smartbit. It demonstrated that the operation for the channel was just $2.40.
btc_throwaway1337 was able to use the idem channel for routing remuneration to and from others because TorGuard already has canals open with sellers and customers. Interestingly, the company is a purveyor of anonymous VPN, email as well as proxy services.
Lightning Network On The Stage
LN, or Lightning Network has been a long-expected solution to bitcoin’s scalability problem. Although it has been deployed this year January, it is been still developed and remains an experiment. It is expected to use an off-chain protocol, which means that the users will be able to launch unreliable small payments channels in order to conduct one or several payment operations ‘outside’ bitcoin’s core – blockchain.
Particularly, these channels are located outside of the BTC blockchain, but the transactions will take place precisely in them. Once they are executed, all these transactions will be distributed back to the blockchain as the single operation, though. Thus, the load on the blockchain is anticipated to reduce.
But there is still a lot of controversy over the LN work. That is why the user btc_throwaway1337 warned the other bitcoin enthusiasts about losing the money when executing transactions through the Lightning Network mainnet.