A Simple Introduction to the Bitcoin Lightning Network
The best comparison for Bitcoin in its current state is the internet of the 1990s and early 2000s. It is slow, has a hard to use interface, and not much can be done with it. It is a necessary base layer on which all of these deficiencies can eventually be improved upon. Much like how innovators and entrepreneurs built features and services such as video sharing platforms, social networks, and marketplaces on the internet, stakeholders in the Bitcoin community need to build tools and services on top of Bitcoin for it to reach its full potential.
These early innovations are often referred to as “second layer” solutions as they are the first layer built on top of the Bitcoin Blockchain. These “apps” leverage the core features of Bitcoin such as the security, uptime, and reliability and add other features in order to increase the overall functionality of the entire system. The most promising second layer solution in development is the “Lightning Network.” The lightning network enables users to conduct transactions with fees as low as one satoshi instantly. For the longest time, the biggest knock on Bitcoin has been the fact that it cannot be used as a peer-to-peer cash system because transactions take too long to confirm and fees are too high. The lightning network solves both of these problems!
This blog series will dive deeper into why we need the lightning network, how it works, its use cases, the challenges to mass adoption, and future layer two and three apps and features.