Potential DNM use of Bitcoin LN

12:00 minutes in this guy starts to reference this topic.. https://www.reddit.com/r/Bitcoin/comments/6vu3pw/really_good_and_simple_explanation_how_the/?ref=share&ref_source=link

Lightening network allows groups of people to update the state of shared funds.

Therefore a DNM could implement it in this way:

The market sets up a payment channel with each vendor, this wouldn't clog the blockchain because markets often need to do a transaction anyways, often a vendor bond.

The market also sets up a payment channel with each buyer when they are ready to purchae an item.

Therefore With two on-chain transactions the buyer is connected off-chain to every vendor on the site.

I'm still trying to work out the trustless nature of this, but because all segwit ready buyers will be using a multisig wallet I think their funds would be secure.

It would work like this: there could be a timelock on the transactions for say 1 month and the funds originally are sent to the address as the buyers still. As long as the multisig address is verified somehow there is no risk of losing the funds without forcing the buyer to sign the multisig transaction and broadcasting the new state to the bitcoin blockchain.

This is actually terrific for Bitcoin. Any thoughts, anywhere my understanding is lacking?


Comments


[3 Points] yes_true:

Your understanding is good. Lightning has the potential to really revolutionize DNMs.

Better would be to further abstract the payment channels - the vendors work with their own brokers that then connect to markets, and again on the other side with buyers.

edit: to expand further. this means you can switch DNMs or DNMs can come and go and you don't have to open or close channels. it abstracts payments away from the markets which makes the system more distributed and resilient (I don't believe there would be probable cause to take down a LN node that has channels to DNMs much in the same way today there is no PC to take down bitcoin mixers)

I can see LN as the first step in a number of next steps that will eventually lead to more distributed and decentralized darknetmarkets

There is also a proposal for onion-routing on Lightning and other similar proposals. It really is a whole new world with CSV, SegWit and L2 protocols like Lightning

edit: left out the obligatory Monero! /s