Ethereum: Routing in Bitcoin Lightning Network

Ethereum: Understand the complex process of routing payments in Bitcoin Lightning Network

The Bitcoin Lightning (LN) network has revolutionized the way in which people and institutions can move value through borders without the need for intermediaries. While its decentralized and without trust architecture is a key factor in its success, the process of routing payments within the LN is still wrapped in mystery. In this article, we will try to break down the complex process of routing payments in the Bitcoin Lightning network.

General description of the architecture of the Lightning Network

Lightning Network is an open source project that allows faster and faster transactions between individuals or organizations through a network of nodes called “bars.” The network is built on the Bitcoin block chain, but is not based on it. Instead, use a decentralized and confidence architecture to facilitate peer payments.

Payment routing process

In the Lightning Network, the payment of payment occurs when an individual or organization initiates a transaction in the block chain using its own private key. The resulting public key is used to create a “payment channel” with another node on the network. This process involves several steps:

• Creation of transactions : An individual or organization begins a transaction creating a new output in the Bitcoin block chain, specifying the recipient and the amount of payment.

• Private key extraction

  

  : The individual extracts his private key from his wallet.

• Public key generation : A new public key is generated using the extracted private key.

• Creation of the payment channel : The public key generated is used to create a payment channel with another node on the network. This process implies creating multiple “bars” in the block chain, each of them representing a specific segment of the payment flow.

• Channel segmentation : Each bar is segmented in smaller segments called “payment spaces”. These payment spaces are even more divided into “blocks.”

• Creation and propagation block : A new block is created for each payment slot, which contains all the information necessary to move funds from one node to another. The spread of these blocks occurs through a distributed nodes network.

• Channel update : The payment channel is updated by adding or eliminating the payment grooves as necessary.

The routing process

This is where things get complex:

• Routing decision : When an individual begins a transaction, the routing algorithm decides what node use for the payment channel. This decision depends on several factors, including the amount of funds that are transferred, the required security level and network congestion.

• Routing the payment channel : The chosen node creates a new payment channel with another node in the network, using the public key generated.

• Channel update : The selected node updates its payment channels to include the newly created channel segment.

• Creation and propagation of blocks : A new block is created for each payment slot within the updated payment channel.

Challenges and limitations

The routing process in the light network is plagued by several challenges:

• Scalability : The network is still in its early stages, and faces scalability limitations due to the large number of transactions to be processed.

• Security risks : The decentralized nature of the network makes it vulnerable to safety risks, such as the commitment of nodes or the collapse of the channels.

• Complexity : The routing process implies complex algorithms and rules to guarantee a safe and efficient payment flow.

Conclusion

The payment routing process in the Bitcoin Lightning Network is a complex and dynamic system that requires careful planning and management.