10 sats \ 1 reply \ @tomlaies 15 Dec 2023 \ on: Can lightning allow closed channels to dump to lightning instead of on-chain? lightning
No this is not possible.
The balance in a lightning channel always stays the same if you add up what both parties have. This is because of how channels fundamentally work: Opening a channel is a transaction to an UTXO that is owned by both parties. Transactions in a channel are just unpublished transactions of this common UTXO. You can't close a channel and move all funds without touching the common UTXO.
(This explanations was very simplified. If you want to delve in deeper you can look up how hashes, hash preimages, HTLCs and digital signatures work - they are what ensures what I previously called "unpublished transactions")
This is what I was afraid of. I kind of knew it conceptually but couldn't put it into words. Thanks for that.
So this begs the follow-up: Would you move the bulk of your wealth into lightning channels? I think most people would only do so if it's a custodial channel that they never have to think about balancing nor fearing closure. In fact, just the fees from those events being passed along by the custodian will get too high for them one day.
Hard to think of a way around this dead-end for lightning. :(
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