Jiang Zhuoer: There are huge risks in implementing lightning network in China, and anti-money laundering supervision may shut it down

Golden Finance News - Although Bitcoin Unlimited (BU) still has huge controversy that caused Bitcoin hard fork, some Chinese Bitcoin miners have decided to support Bitcoin Unlimited. Their statement made the support rate of Bitcoin Unlimited surpass that of Segregated Witness, which makes people guess that China's Bitcoin industry is more inclined to BU.

Mr. Jiang Zhuoer, founder of Litecoin Mining Pool and unlimited supporter of Bitcoin. Image source: Golden Finance

At an event on March 28, Huobi, one of the three largest bitcoin exchanges in China, invited Jiang Zhuoer, founder of Litecoin Mining Pool and supporter of Bitcoin Unlimited, to discuss the sustainability of the Bitcoin Unlimited client and the congestion issues currently facing the Bitcoin blockchain network.

During the event, Jiang Zhuoer pointed out that the two-layer network solution adopted by Segregated Witness, such as the Lightning Network, could be "easily" shut down by Chinese regulators.

Jiang Zhuoer said,

“The Lightning Network is likely to foster a monopoly-capable LN (Lightning) data processing center, just like Alipay and WeChat Pay. At that time, relevant agencies may shut down the Lightning Network when implementing anti-money laundering regulatory functions. Then the transaction data originally processed by LN will be forced to be transferred to the 1M main chain of the Bitcoin blockchain. The huge transaction demand will cause network congestion, and the Bitcoin network will soon be paralyzed.”

Jiang Zhuoer believes that there may be many potential risks when running the Lightning Network, including paralysis of the Bitcoin network and inefficient operation.