Lightning Network

What Is a Lightning Network?

The Lightning Network is a Layer 2 protocol that solves scalability issues with existing blockchains networks. Lightning Network is a layer 2 protocol designed explicitly for Bitcoin blockchains. It is primarily used for payment solutions on Bitcoin. 

The Lightning Network is meant to improve transaction speed by reducing processing time between nodes on the blockchain. It is part of the Layer 2 protocols designed to solve the scalability problems of existing blockchains which are slowing down due to the high flow of transaction traffic. 

The Lightning Network is primarily designed as a payment protocol and works on top of the existing bitcoin network. It takes transactions off-chain and helps reduce the time taken to process the transaction. 

**Scalability Solution for Bitcoin **

Both the popular blockchains are under criticism for being unable to handle the increasing flow of transactions and choking up under growing demand. For example, Bitcoin can process just seven transactions per second compared to Visa’s capacity of 20,000 transactions per second. The Lightning Network was developed to help the Bitcoin chain handle the excessive flow. 

It has successfully handled payment transactions and sped up the transaction processing time. This is because the Lightning Network works by letting transacting parties interact without having to go through nodes, which requires using layer 1 and takes time. 

This feature is under criticism as approval from nodes is a crucial security feature. The authorization from nodes is done after authenticity confirmation from both sides of the transaction. Many people also criticize the Lightning Network as vulnerable to hacks and fraud.