In this post, we'll explain how we used MuSig2, a protocol for aggregating public keys for the Schnorr digital signature algorithm, to enhance Lightning Loop, our non-custodial submarine swap service between on-chain bitcoin and the Lightning Network. Submarine swaps enable users to swap on-chain Bitcoin for off-chain Lightning Network Bitcoin (and vice versa) using hash time-locked contracts (HTLCs), ensuring atomicity and eliminating counterparty risk.

We are also excited to share a recent upgrade to the Loop In swap, which allows users to send on-chain bitcoin directly into a Lightning channel to replenish outbound, for Lightning Loop. The most recent Loop release allows Loop In users to fund a Loop In swap on-chain well in advance of the off-chain execution of the swap by leveraging MuSig2. From an end user perspective, this enhances the functionality of the Loop In flow by reducing the complexity of the user experience, allowing for the potential of locking in lower costs, and enabling swap retries.

...read more at lightning.engineering