I hope someday SN will offer lndhub for SN accounts. Users could use SN wallet in Zeus or Bluewallet app directly.

Hosted channels and lndhub are a good simple way to onboard new users.

Later they can add more self custodial wallets once they learn more.

I explained here a scenario that experienced bitcoiners should do: LN banks for friends and families https://darthcoin.substack.com/p/bitcoin-private-banks-over-lightning

Nothing wrong with some level of custodial accounts, if the user is well informed.

Also if are not KYC could be a good decoy mode to receive sats with increased level of privacy. As I explained in this guide https://darthcoin.substack.com/p/operating-with-ln-as-a-merchant

Non-custodial channel liquidity needs to be a priority for Lightning businesses & entrepreneurs.

It’s such a crappy experience, downloading the chain, installing the lightning app and attempting your first payment, withdrawal or even channel open and still not finding a route to your node.

Until then, custodial lightning offers the convenient workaround

It is until it isn't.

Ideally businesses will be building less convenient solutions, storing servers and setting up businesses in more obscure locations. The West could be a big weakness for Lightning Network, in terms of infrastructure. Leading the way, but we can't always rely on rule of law in these jurisdictions to support the globe. As we have seen with exchanges and organisations like Paxful recently. More draconian regs are coming down the pipe with the Restrict act and other branches of it. It hasn't hit home that the very same laws extend to these platforms. It's going to force us to adopt non-custodial Lightning much much more. Starting 2024.

It's great that it's possible to custody small amounts at zero margin cost to the custodian. We all kind of take this feature of digitally native money for granted.

But, as we are all aware, it's not ideal.

That's the interesting thing about custodial LN. Because it can handle minuscule sat volumes, you can make the third party risk aspect essentially null by never putting more than 10k sats or something in there (as I say with >40k in my alby wallet rn lol).

What is sad is that one day regulators, even if they accept Bitcoin, might try to put the same regulations that exist on banks onto custodial lightning, which would all but kill the things we love it for. Of course, since making a small, private, custodial wallet for peers is so easy, the regulations really wouldn't matter.

Its great for relaying the concept, providing training wheels and getting people in with low friction, but it doesn't mean we can't improve the amount of people who transition towards non-custodial.

Sure keeping 69 sats on a wallet is fine, but if people don't learn they'll be sitting with 69 million sats on a custodial wallet and that to me is a dangerous position to be in

I have the not so popular opinion that using lightning in a custodial way is fine.

I do wish that somebody builds something like this: a LN wallet that allows to split your balance across several custodians, yet has a UI simple enough that users can also ignore these details if necessary.

With that, we could have people store their small, day to day LN fund across a few reputable custodians, minimizing the risk of a full rugpull and promoting competition across custodians. Add chaumian ecash a la Cashu and you have awesome privacy.

Onboarding normies is impossible without custodians. The tricky part is ensuring they move out when they reached have a certain amount of funds or knowledge

If this thing -- the whole btc enterprise -- is long-term successful, there will be a wide array of options across all levels of custodian-ship (?) and trust. You can take a trust-minimized system and add trust requirements in return for a better user experience. You cannot realistically do the reverse, which is why it was so important to build btc the way that it was built. This distinction will matter, crucially, in the end.

No. It's taking a shortcut for something that's very hard to achieve.

Sure, it's nice to be able to tip here with a click, but it's basically cheating. Instead of implementing Alby for self custodial tipping, or any other complex solution we might come up with in the future, it's much simpler for the website to implement custodial lightning. Holding Bitcoin yourself is always the goal and we should strive to make that easier instead of building easy "solutions" to complex problems.

Self custody isn't that hard and if we normalize custodians now, suddenly people will wonder "why should I even self custody?"

In my work as a Bitcoin educator, I help interested people to take their first steps into the space and gain an understanding of why Bitcoin is important for them personally and for the world at large. I also help Bitcoin community builders to become educators and share their knowledge with their peers. My focus lies on financial sovereignty, which can only be achieved by holding bitcoin in self custody and using additional tools to reach a decent level of privacy.

I don't think they're all that great. The only good things going for them right now is that the majority of them don't require KYC and you don't have to pay any channel opening fees/manage liquidity.

I don't see the non-KYC part lasting tbh, and it's a risk if WalletofSatoshi/Kraken/etc end up becoming the most well-connected nodes on the network, since it'd be much easier to enact AML/KYC laws.

If you don’t mind not owning your coins