{"id":1490,"date":"2020-01-27T10:49:20","date_gmt":"2020-01-27T18:49:20","guid":{"rendered":"https:\/\/www.opennode.com\/blog\/?page_id=1490"},"modified":"2020-02-03T00:21:56","modified_gmt":"2020-02-03T08:21:56","slug":"lightning-network","status":"publish","type":"page","link":"https:\/\/blog.opennode.com\/blog\/glossary\/lightning-network\/","title":{"rendered":"Lightning Network"},"content":{"rendered":"Reading Time: <\/span> < 1<\/span> minute<\/span><\/span>\n

Lightning Network <\/h1>\n\n\n\n

The Lightning Network (LN) is a second layer<\/a> technology built on top of Bitcoin\u2019s<\/a> blockchain<\/a>. It uses multi-signature<\/a> addresses<\/a> and smart contracts<\/a> technologies to create bidirectional payment channels<\/a> that move transactions off-chain<\/a>. The ultimate goal of LN is to scale Bitcoin\u2019s transaction speed and throughput while retaining the overall security and immutability of the blockchain.\u00a0<\/p>\n\n\n\n

Like Bitcoin, the Lightning Network sends transactions through a peer-to-peer network. With LN, the transactions send in two ways:
1. Directly connecting two nodes<\/a> together.
2. “Bouncing” a transaction through a web of interconnected nodes via onion routing<\/a>. The parties routing the payment can’t see the final destination, just the next hop. <\/p>\n\n\n\n

Lightning Network transactions are virtually instant<\/strong> and have the potential to have fees lower than a thousandth of a penny<\/strong>. Because LN transactions exist off chain, it doesn\u2019t need miners to validate transactions. This means that transaction speeds on LN are ~600,000x faster than on-chain transactions and have nearly zero fees. For context, Bitcoin on-chain transactions speed is around 7-11 tx per second depending on the load on the blockchain. Lightning Network transactions are capable of millions of transactions per second, which makes it virtually instant.<\/p>\n\n\n\n

Links<\/h2>\n\n\n\n