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21 sats \ 4 replies \ @notgeld 3 Jul 2022 \ on: Lightning is not Bitcoin's second layer bitcoin
No. Lightning is the second layer, and which is more important it allows some specific LN related tech leveraging instant settlement and scaling it further.
"Layer" is a good definition because LN rules are isolated from Bitcoins and network normally works without touching blockchain.
https://medium.com/coinmonks/liquidity-abstraction-in-lightning-network-3d7a1d76ac82
The point of my title really is to get people thinking about the difference between a technical layer and a financial layer. Lighting is indeed a distinct technical layer from Bitcoin, like TCP/IP to HTTP.
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Most importantly is the fact that Lightning Bitcoin is Bitcoin and not a side chain or separate coin.
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Are they really different if we speak about Bitcoin? Wallet of Satoshis is Bitcoin bank for example and it leverages instant settlement for its business. It would be too expensive for it to operate onchain.
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If you are referring to technical layers vs financial layers then yes there is a very important difference, even though custodial wallets have custody of your sats, they pay out in sats, and not their own token.
A Bitcoin bank like Hal Finney imagined would be issuing its own second layer tokens.
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