Lightning Network : SafeContract

What is Lightning Network ?

A protocol that enables high volume, low ­latency digital micro payments without the need for trusted intermediaries.

Benefits :

  1. Simplified atomic swap without third party interference.
  2. Minimising loss of funds in case of failed transaction.If at any time either party drops the channel, the channel will close and be settled on the blockchain.
  3. Watchtower that monitors fraud and security of payment using multifactor checks for payment verification mechanism.
  4. This can be achieved by running two parallel nodes where one acts as payment signing node and another one checks the validation factors between the multiple users.
  5. Python script can be deployed on the channel that manages verification, block extraction and multi layer authentication channel.
  6. When condition matches, either of the party can publish the transaction in the network as a cluster of whole transaction at once, this makes sure if the order is complete with genuine entry and signed transaction with open channel
  7. To implement this network in Ethereum we can use smart contract with locking and time based transaction of funds for fulfilment of every order. In this process gas will be deducted from both the parties to make the final transfer call in both the cases of failed or success transaction.
  8. If the matching order is not confirmed before the elapse time, it will rollback the funds with the reserved gas from the pool.
  9. Atomic swap can become very easy and trusted using the lightning network.
  10. Major drawback of the network is slow speed and order matching that can be optimised by managing order matching off chain and order execution on chain to save time for matching order for both swaps of coins.
  11. Safe Contract is the contract that manages this swap without any third party dependency of the funds and trust system