Golden bitcoin coin in fire flame, water splashes and lightning. Bitcoin Gold blockchain hard fork concept. Cryptocurrency symbol in storm illustration with peer to peer network background.Lightning Network recorded the fastest 100 bitcoin capacity growth in history: just five days. The network, which normally measures how long it takes to process 100 bitcoin, used to process 100 bitcoin every 39 days in March of this year. In July, this time reached a mere 5 days, indicating an exponential growth. In this month alone, the network capacity increased 20%. Currently, the Bitcoin network is capable of processing up to 7 transactions per second. This throughput would need to increase by magnitudes in the thousands, or even millions, to support the global economy, mainly due to the fact that any blocks written above 1 megabyte are invalid in the current Bitcoin mainnet. Although many have already proposed a change for this limitation, simply increasing the number of transactions in a single block would imply a very rapid increase (considering current storage technology) in blockchain size, which would leave behind informal node operators (“nodes”). , Bitcoin's ability to scale was highly doubted, comparing it negatively against traditional transaction processing networks such as Visa and PayPal. But Bitcoin is a basic layer solution, while networks such as Visa and PayPal are built on third or fourth layer of the fiat currency system, with transactions not actually being finalized for several days. However, with the introduction of Lightning Net work in March 2018, the narrative of Bitcoin's scalability has completely changed. Like Bitcoin, the Lightning Network is a network of nodes working together, peer-to-peer. Lightning Network's goal is to facilitate secure, anti-double-spending transactions in their separate “second tier” before finally establishing them in the Bitcoin blockchain. The first step in any transaction on Lightning Network starts with a channel. A channel connects two nodes and allows them to transmit information, or in this case bitcoins, to each other. Lightning's channels are built using multisignature (multisig) addresses that both parties can interact with. These addresses allow both users to bundle (or send) as many bitcoins as they want to the address, but funds can only be extracted from that address. shared if both parties agree. Lightning Network uses multisig addresses. These addresses embed a “timer” in the address as part of the script. That way, if one of the parties goes offline or refuses to trade when the other party has funds at the address, the funds can be returned to the original user after a certain period of time, avoiding double payments.Lightning allows nodes to send transactions each other, while simultaneously keeping the bitcoins encrypted until they reach their final destination or “target node”. Thus, all transactions that go through a channel are overwritten in a single transaction and settled on the Bitcoin network. Altogether, the first variations of Lightning Network can make up to 25 million transactions in a single second and settle on the Bitcoin blockchain as one transaction. It's as if the network “drafts” the transaction, only to carry it out later. This, if properly applied, can be revolutionary. Read more:
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