"Lightning self custody works for 100 million users" "But it needs 10 billion!!" \ stacker news ~bitcoin

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"Lightning self custody works for 100 million users" "But it needs 10 billion!!"

2998 sats \ 22 comments \ @standardcrypto 24 Mar bitcoin

peter todd, sourced and mathematically argued quite convincingly, "Lightning can probably support low hundreds of millions of users with current technology."

#681498 buried in a good conversation btw if you care

another one from alex bosworth, also buried in some wider context which is worth a read

A common objection to this is,

"but there are more than 100 million people! So we need a scaling softfork. If that broadens the attack surface, it's just a price we have to pay. Otherwise bitcoin will become a custody solution only for the very rich, with banks able to rug pull and fractional reserve just as they did under the gold standard, and a typical user will be at their mercy. Bitcoin will be meet the new boss same as the old boss. Goodbye to our dreams of freedom."

So here's my 2c about that.

the masses aren't stupid, and you can't chalk it all up to laziness either.

physical security is hard, really hard.

and if you keep your hardware wallet seed phrase in a bank safe deposit box, how different is this really from just keeping your utxos as an IOU in the bank?

OK the bank doesn't have the device pin number so it's different. You could also do multiple safe deposit boxes in different banks, and maybe throw in one buried in the backyard or with your lawyer, so it's different.

But now you are trusting the hardware device manufacturer to not backdoor the random number generation. You are trusting the M-of-N quorum to not screw up and betray, even picking a good M and a good N is hard.

OK, figure out hte M and the N. Make your own hardware wallet using an esp32 chip. Or maybe you should use the trezor mostly open-source thing with a secure element ("tropic square")....... Yeah but what % of people will actually do the analysis, the homework, figure out the maze of security tradeoff and then make a rational decision for achieving the best security/convenience tradeoff? I think it's well under 1%.

And that's how you go from 10 billion people to 100 million custodians in a well distributed "custodians are family/small businesses" plus a few whale custodians in banks/exchanges, lightning network scenario.

Scaling softfork?

YAGNI.

Don't let scaling or vaults be a trojan horse for those who would shitcoin on bitcoin, for the benefit of a few insiders at the cost of a broader security surface for all.

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115 sats \ 8 replies \ @justin_shocknet 24 Mar

I think this is why its important to mock and deride scaling alarmists, it'd be one thing if they were just complete morons wasting their own time, but its much more harmful to the ecosystem to have these narratives out there unchecked and effecting the capital structure that invests in Bitcoin products and overall development.

The same technical ignorance that keeps people afraid of self-custody gives the scaling FUD traction. It's made worse by the fact that it's an appealing virtue signal that no hipster can refuse, they want you to know how much they care about equality and sovereignty blah blah blah.

I've beaten on the fact that supply distribution is the only real scaling limitation, and even this isn't a problem because its not about the number of people on earth we need to scale to, but the number of organizations. There's not even 500 million businesses on earth, every one could be a custodian if they CHOSE. Then there's not even ~1.5B extended households on earth, every household could still have self-custody (people already choose to share critical things like bank accounts, houses, etc)

Astroturfing of counter-facts are why centrally coordinated fake scaling applications like Ark need a full media blitz despite having no product, because if people realized we can already scale to every household with things like Lightning.Pub then their ability to raise on scaling FUD goes away.

0 sats \ 5 replies \ @pakovm 24 Mar

Let me try to get this straight, in the same comment you are saying that we shouldn't scale to people but to organizations (which are inherently centralizing btw) and that Ark is a fake scaling application when Ark essentially does what you are claiming is the solution for scaling?

I think I lost braincells just by reading it.

0 sats \ 4 replies \ @justin_shocknet 24 Mar

I think I lost braincells just by reading it.

You're the avatar of the mindless hipster that can't resist a virtue signal because your ideas are shit, I doubt you had any brain cells to spare so pipe down.

organizations are inherently centralizing

Thats right hipster, a node for every family and small business is centralizing.

Your scammer buddies running a massive sybil-prone fake L2 that harvests data without actually scaling ownership is obviously not centralizing though.

What you hipsters can't grasp is that decentralization and equality is making trust as local as possible, the home or small business. Not with your scammer friends.

0 sats \ 3 replies \ @pakovm 24 Mar

O, let me try to argue with you here, but the level of ad-hominen here demonstrate that this will be hard.

The biggest problem with your approach is believing that people will "just run nodes", people won't, that's a pipedream, people will trust profesionals to run nodes, manage liquidity, keep the software up-to-date, etc, etc... because the division of labour exists, this will ultimately centralize things into very trusted nodes which will act as banks for most people, ending up in the same problem all over again.

As someone who used to work in retail and restaurant management in his 20s, let me tell you, business will NEVER run their own infrastructure, only a few will try to do so and most will either fail at that or export it as a second business, so no, the way you think Lightning will decentralize itself by virtue of people running it won't happen.

What matters really is that those infrastructures are trustless, and Ark tries to do that exactly, be trustless, because decentralization is a means to an end, which is trustlessness, and as long as things are trustless the level of centralization is non-important, while you don't have to trust an ASP, you will always have to trust a Lightinig Custodian, whether that is a giant business or your toxic psychotic cousin who has been caught using the family money to gamble multiple times but is the only one capable of running a node in the family.

0 sats \ 2 replies \ @justin_shocknet 24 Mar

ad-hominem

Do you even know what that means? I didn't say your ideas was shit because you are a hipster retard, I simply insulted you and then said your ideas are shit.

people will "just run nodes", people won't

I know comprehension is an issue for you, or you wouldn't believe the things you do.

My entire premise is that people won't run nodes and that's why its only hipster retards talking about billions of users.

Many organizations will, most won't, but they all have the option and the number of them won't change regardless of whether or not your shitfork becomes consensus.

Therefore the only tooling that matters is that which gets trust distributed, which is the opposite of Ark.

infrastructures are trustless, and Ark tries to do that

Ark is not trust-less, even with a shitfork it makes a lot of negative trade-offs, which might be fine if the marketing departments weren't so dishonest. Why does something pre-product need marketing anyway? Oh thats right because its a narrative scam.

It's tooling for large trusted coordinators, not distributing trust to the edge.

toxic psychotic cousin

You misidentify ad-hominem and jump right into using ad-absurdum, entirely predictable mid-curving.

10 sats \ 1 reply \ @pakovm 24 Mar

I would love to discuss this more in depth with you, but all you are doing is insult me, so see ya.

Just don't be surprised when people block you on social media, everyone calls you a retard publicly, nobody uses your apps and nobody takes you seriously on Delving Bitcoin.

Have a nice one dude, hope you find the professional help you need for your anger issues someday.

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0 sats \ 1 reply \ @ealvar39 24 Mar

I'm not so sure that there is no basis for scaling improvements to the bitcoin network. even if existing lightning could scale to meet the needs of everyone that wants to use it, whether these are huge fedimints or some other type of e-cash mint or something, improving lightning could be a huge boost for the businesses and people that are running the lightning payment gateways.

Overall I think it makes sense to have some people looking forward and planning for what bitcoin may look like 5 years from now.

0 sats \ 0 replies \ @justin_shocknet 24 Mar

If there were any basis the scaling alarmist would be able to quantify it, but they refuse to. The only metric they can regurgitate is how many individual people there are on earth. This isn't a technical demand, just the aforementioned hipster virtue signaling about sovereignty and equality.

They have no idea what things may look like in 5 years, and the fact that they pretend to while having no basis on which to set their goal posts should be your first clue.

These are not serious people. Many of them are outright bad people using a fake issue to divide and scam.

Lightning, or any other alleged L2 and even "Vaults" does inherently come with a liveness trade-off, which makes it more difficult than the base chain. I could entertain ideas on how to make that UX better, but no one is talking about that, because the underlying constraints are not solvable.

20 sats \ 1 reply \ @KYC 24 Mar

The talk about Bitcoin scalability and whether the Lightning Network can handle the load is always a hot topic. Peter Todd has already done some math showing that, with current technology, Lightning can support hundreds of millions of users. But of course, not everyone agrees.

The main criticism is that Bitcoin might end up becoming a system only for the rich because Lightning, as efficient as it is, might not handle global demand. If that happens, people will end up relying on custodial solutions like banks and exchanges, bringing us back to the same old story of the traditional system: fractional reserve risks, centralized control, and the nightmare of losing access to your own funds.

Another tricky point is security. Everyone says the ideal is to hold your own keys, but in reality, that’s way harder than it sounds. Store the seed phrase? Where? In a bank? In the backyard? And what if the hardware device gets compromised? What if the M-of-N scheme fails? In the end, most people won’t be able to handle all that and will end up trusting third parties anyway.

Then comes the softfork debate. The people pushing for it believe the only way out is to increase the network’s capacity by changing Bitcoin’s structure. But that could also open up new security risks, and honestly, do we really need that right now? The "YAGNI" (You Ain't Gonna Need It) principle makes sense here: don’t mess with the code unless there’s no other way.

Bottom line, but far from a conclusion, Lightning Network can definitely support a lot of users, but will that keep Bitcoin decentralized the way we want? Or are we heading towards a model where only a few hold the majority’s funds? The best path might be to keep improving the tech gradually, without rushing to change everything at once. Let’s see how this story unfolds!

0 sats \ 0 replies \ @sangekrypto 24 Mar

everyone hopes it will be well decentralized, yes you are right, so don't rush it.

20 sats \ 1 reply \ @standardcrypto OP 24 Mar

I neglected to include the alex bosworth scaling commentary in the top post sorry, here it is:

#907529

The same thread contains a discussion of why I now distrust the ark push for a covenant softfork:

quoting peter todd

""On-Chain Fee Payment In Unilateral Withdraw Similar to Lightning, the economics of on-chain fee payment and the actual value of a V-UTXO after fees determine whether Ark usage meets our definition of an L2 via unilateral withdrawal, or fraud failing to benefit the ASP. We’ll discuss the specifics of this further when we discuss the txout tree design pattern.""

justin_shocknet: "I think its fair to say if someone with Peters grasp on the fundamentals has done a review of L2's, and can't conclude whether something is definitively an L2, then it's not an L2."

0 sats \ 0 replies \ @ealvar39 24 Mar

Hey one interesting thing i learned on the stephan livera podcast. ark developers actually consist of 2 camps, one optimizing for bitcoin payments (currently on bitcoin signet) and one camp optimizing for building application layers (currently on liquid).

I'm raising this because this comment doesn't seem to take into account that there is an Ark implementation very focused on improving bitcoin payment UX.

The episode is here and I think it may be a good listen to understand a little better what is currently going on with the Ark Protocol: https://stephanlivera.com/episode/645/

10 sats \ 0 replies \ @standardcrypto OP 24 Mar

also, proud stacker news user

"I onboarded 12 people to self custody." "Great job!" "Thanks, cost me 3 years of my life."

#679919

0 sats \ 2 replies \ @SwapMarket 24 Mar

100mil will be enough because 99% of normies will never care. They are too comfortable in their invisible prison cells and don't want to climb the learning curve. For most, Bitcoin will always be just one more investment instrument, handled by a regulated entity. Especially now, when Travel Rule and AML freezes make non-custodial UTXOs scarier by the day.

0 sats \ 1 reply \ @anon 22h

If you use Bitcoin as intended, for peer-to-peer transactions, you don’t have to worry about rules set by non-elected agencies. These rules can only be enforced on public companies.

0 sats \ 0 replies \ @SwapMarket 20h

That was my view as well until yesterday. But then I saw in the Boltz telegram group that people are checking UTXOs they receive in a swap against chainanalysis bots like @BitOK_AML_bot. Because exchanges use the same services for AML and freeze such deposits. I won't send my UTXOs to CEXes, but most normies will sooner or later.

0 sats \ 0 replies \ @Ge 24 Mar

What they've been saying and the outlook is looking like different L2 scaling solutions with lightning being the glue 🤔 I can't go too deep myself figure someone on here can there will be bunch of custodial I'm assuming since coinbase holds Michael saylors...lol

0 sats \ 0 replies \ @SimpleStacker 24 Mar

I'm of the opinion that trusted custodians are inevitable.

But Bitcoin still has a HUEG differences from fiat/tradfi:

Can't be printed by national governments. HUGE.
Option to go non-custodial for those who want to. Also HUGE.

0 sats \ 2 replies \ @pakovm 24 Mar

The biggest problem with Peter Todds approach is that he believes in the "If people would just", and no, people won't just.

On the soft-fork thing, you are conflating various things, none of those soft-fork proposal will give us shitcoins on Bitcoin, at max they will be able to prove off-chain shitcoining on Bitcoin, but BitVM is in development, which will also allow for softfork or not, simply more blockspace inefficient than adding the right primitives to Bitcoin Script, so I don't really why people fear this, we all know that shitcoins have no value and even if they come to Bitcoin in a way that's not the already existing one, they will all be worth zero and the worst they will be able to do is take up some blockspace, which they do already.

CTV+CSFS will allow not only Lightning to scale due to Symmetry channels and Ark to become trustless, but also will allow for simple vaults which will reduce the risks of self-custody. Furthermore, there's not a single soft-fork proposal (that's being taken seriously) that changes the security model of Bitcoin, also they are all way less complex are already more scrutinized than Segwit or Taproot ever were.

0 sats \ 1 reply \ @ealvar39 24 Mar

I've been researching and discussing this a lot recently. I think the main fear is from recursive covenant op code proposals like OP_CAT.

The argument against non-recursive covenants like CTV & CSFS seems to be more centered on whether this is actually even necessary right now given low network demand.

0 sats \ 0 replies \ @pakovm 24 Mar

That's been the discussion so far, the thing, if I'm not mistaken (BIG IF as I'm no coder) is that recursive covenants are only recursive within themselves, so the worst that can happen is that they eat up the memory of a node trying to validate the whole TX because of the recursive execution of the script, but there's been a lot of FUD around recursive covenants being able to propagate themselves as if Bitcoin was an account model chain and not an UTXO model where only the receiver writes the spending conditions.

When it comes to CTV+CSFS lack of demand's argument, I believe Steven Roose makes the best counter-argument:

In fact, BitVM is a good example of the result of the lack of expressiveness in bitcoin’s protocol. It is essentially a bad version MATT, but built as a workaround around the lack of covenants in bitcoin. To me this shows that there is great demand for this expressiveness and developers are going to extreme lengths to obtain equivalent behavior in the ugliest possible ways.

source for the quote