21 Jan Lightning Network Is Happening! First Physical Item Purchased on LN
The cryptocurrency community is celebrating what may have been the first ever transaction on the Bitcoin Lightning Network’s (LN) mainnet. Additionally, the good news is that the Bitcoin payment operation was, “instantaneous and fee-free.”
LN Transactions Prove to be Cheap and Faster
The cryptocurrency community is becoming increasingly enthusiastic about the LN implementation because it promises to significantly lower Bitcoin’s transaction fees while making possible near-instant transactions.
Social media is humming with news references to LN technology progress. And, when Reddit user btc_throwaway1337 announced that he had successfully used the LN mainnet to make a purchase, crypto enthusiasts rewarded the news with over one thousand five hundred upvotes.
Was this the first physical item purchased on Lightning Network? ⚡️https://t.co/tSq8mOcCSX
— TorGuard (@TorGuard) January 19, 2018
Specifically, user btc_throwaway1337 announced:
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.
He described the purchase experience as follows:
It was all quick, easy, painless, and most importantly: instantaneous and fee-free!
User btc_throwaway1337 also submitted proof of the purchase, shown here, indicating that the funding transaction for the channel cost about $2.40 USD.
And, because TorGuard already has channels open with vendors and users, he was able to use the same channel for routing payments to/from others.
TorGuard is a provider of anonymous Virtual Private Network (VPN), proxy, and email services.
LN Nodes and Channels Propagation
The Bitcoin Lightning Network is a decentralized system where participants can implement trustless micropayment channels to execute one or multiple payment transactions off-blockchain.
The channels reside off the Bitcoin blockchain. Transactions occur between the channels. Upon completion, these transactions are broadcast, as a single transaction, to the blockchain. Once the payment channel is closed, transactions are transcribed onto the Bitcoin blockchain.
Consequently, regardless of the number of transactions performed, the blockchain is accessed only twice, at the opening of the channel and the closing of the channel.
The implementation of LN nodes is gaining momentum. As of this writing, LN boasts over 67 nodes and 128 channels running on the mainnet with a capacity of 133758803 satoshis, about $17,128.16 USD.
The graph below shows the impressive LN progress.
Granted, Lightning Network technology is still an experiment. However, the growing number of nodes and channels already under testing predicts that the full LN implementation is coming soon.
Bitcoin’s outlook is looking brighter because Bitcoin LN, combined with Segwit, Schnorr Signatures, and other schemes are concrete optimizations that aim to solve Bitcoin’s most pressing problem: scalability.
How do you think the implementation of the Lightning Network will impact Bitcoin? Let us know in the comments below!
Images courtesy of Pixabay, Inmainnet, p2sh.info