Will Cardano have some form of off chain transaction system like the Lightning Network ? I ask because it sounds like that could be a game changer for BTC if it works as planned. Exponentially greater transactions / second than Visa, instant transactions, nominal fees and privacy. That could move it from a theoretical payment system to a reality in daily use.
Any blockchain could potentially develop their own equivalent of lightning, or better termed ‘off chain 2 way transaction channel’…but the reality is Lightning has been talked about for some time, Raiden (Ethereum equivalent) has been talked about for some time, even IOTA did some beta with ‘flash channels’ last year.
But ultimately it’s only been a lot of talk…to do it in BitCoin, my understanding is you’d need a whole separate layer above it to do it, it generally only benefits when you want to have a lot of transactions between two parties (no real savings as far as a single transaction which is the norm), etc.
Anyway, it’s not the magical panacea for scalabilty as far as I can tell unless you are in dire need of doing hundreds of transactions between you and another party and you both want to leave deposits to open the channel. I can see in some cases like between businesses that have a large amount of accounts to settle it would be nice, but it doesn’t really help for the more typical scenario imo.
So summary is I hope Cardano sticks to addressing core blockchain scalability instead of going off into variants that are both special case and so far unproven in real usage by anyone.
If I understood Charles right in one of his talks, the whole point of doing this via dPoS is for the network to be able to scale infinitely in a distributed manner, the more participants join, kind of like BitTorrent. So, I don’t expect to be any layered network, Lightning style, to be on top of it. It should scale as is.
That was my understanding but will that scale to the same level as a functioning lightning network ? Just playing devil’s advocate.
The additional layer is specific to BTC. I don’t think ETH etc need the additional layer b/c they have more meta-data involved vs BTC is relatively speaking a dumb currency. However, assuming my understanding is correct. the point remains that unless you are planning to need multiple transactions with the same party, there is no efficiency gain relative to just doing it directly on the blockchain.
Hard to say - the test run of Ouroboros noted they were easily getting 250sh tps. Assuming that replicates to the live MainNet, it would already outpace PayPal which is reportedly 100tps avg. Plus, unless you have a dire need for many transactions with the same party you don’t get any efficiency gain.
If Cardano can flag, or better the user can flag, a multi-transaction need with another party, then the overhead of a two way state channel would indeed speed things up dramatically vs trying to do them all in the usual fashion.
So I guess thats my summary - if Cardano can screen or allow users to flag multi-transaction needed state, then having the option of a Lightning network would be a big efficiency gain. Otherwise, I think it’s more complexity for not so much gain as most transactions are simply one and done.
Bring this question again, now that the lightning network on Bitcoin start to be functional, and even Stellar talks about inplimanting this idea to their token in the future.
In my point of veiw it is not logical for any currency to hold the entire excange history on their blockchain. Plus it seems logical that a LN ontop should bring a faster, lower cost transactions.
What is Cardano current view on this topic?
My impression was that Cardano planned to implement scaling primarily via a network of sidechains.
Off-chain transactioning (for applications) is planned to be primarily implemented in the form of MPC over RINA with the on-chain settlements.