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On September 24, a BTC&ETC Meetup event hosted by BTCC was successfully held in Shanghai. The event brought together many digital currency enthusiasts from China and abroad. Joseph Poon, the founder of the Lightning Network, known as the "Lightning God", attended the event to share the latest developments of the Lightning Network. The Lightning Network was created to solve the scalability problem of Bitcoin. Simply put, the purpose of the Lightning Network is to achieve safe off-chain transactions. It is essentially a mechanism that uses hash time-locked smart contracts to safely conduct 0-confirmation transactions. By setting up clever "smart contracts", users can make unconfirmed transactions on the Lightning Network as safe as gold (or as safe as Bitcoin). Since most transactions are conducted off-chain, the Lightning Network can greatly improve the efficiency of block processing transactions. Pan Zhihao is a Chinese American who has been exposed to Bitcoin since 2011. In 2013, he began to think about the Lightning Network. In February 2015, he first proposed the concept of the Lightning Network and completed the design of the paper. At the event, he shared the latest developments of the Lightning Network with the digital currency enthusiasts present: the Lightning Network has been tested and run on the side chain, the Element Chain developed by Blockstream, and technical personnel in the Bitcoin community are also contributing to the improvement of the Lightning Network. During this trip to China, we had the opportunity to talk to him about the latest developments in the Lightning Network, his experience with digital currency, and some of his views. The following is the transcript of the interview: 8btc: How did you get in touch with digital currency? What did you think of Bitcoin when you first came into contact with it? Joseph: I started looking into Bitcoin in 2011, but haven't taken it seriously for a while. I originally thought it was an interesting idea from a technical perspective, but it wasn't until it began to be easily exchanged and used that I understood it was real.
I first came across Bitcoin in 2011, but I didn’t take it seriously at the time. I initially thought Bitcoin was just an interesting idea from a technical perspective, but it wasn’t until Bitcoin started to be easily traded and used that I understood that Bitcoin was real.
8btc: How did you and Thaddeus Dryja come up with the idea of Lightning Network? How long did it take to complete the draft? What was the conception in between? Joseph: I first started thinking about it in 2013, when the blocks first started being used up from the policy-rule consensus soft-cap, Thaddeus had great feedback and thoughts on possible improvements. The paper took a couple months to actually write — it advocated changes to Bitcoin rules which are in the process of being integrated. I first started thinking about Lightning in 2013 when the first block space exhaustion occurred, and Thaddeus had great feedback and ideas on possible improvements. The Lightning Network whitepaper took several months to write - Lightning Network advocates for changing the Bitcoin consensus rules and is currently in the integration phase.
8btc: How is the Lightning Network progressing now? Are there any difficulties? Joseph: It is progressing very well. We are having a Lightning Network meeting right after Scaling Bitcoin Milan to develop and finalize the initial protocol. If there are any It’s going pretty well and we’ll have a Lightning Network meetup right after the Scaling Bitcoin conference in Milan to develop and finalize the initial protocol.
8btc: When do you expect the Lightning Network to be truly implemented? Joseph: The network will be usable after a malleability fix is integrated and activated in Bitcoin. Once Segregated Witness is activated in Bitcoin, it will be usable. That said, initially it should be only used for smaller amounts as the network and software is stress tested. Currently, Lightning is in testing on the Bitcoin Test Network (testnet). Initially, some aspects will not be as user friendly for end users, but over time, these aspects will be developed and made easier to use. However, it should be available for people to use which require instant payments, especially instant micropayment use cases which can significantly expand Bitcoin's popularity in the future. In the long-term, there is direct value from Lightning enabling traders to move Bitcoin between exchanges instantly, brings about better User Experience for Bitcoin to be more similar to existing payment flows (instant payments, invoicing), as well as bringing about true micropayments. I believe that micropayments are one of the major killer apps for bitcoin, and Lightning will be bringing that to be a reality in the coming months. The Lightning Network will be available after some kind of malleability fix is integrated into the Bitcoin network and activated. The Lightning Network will be available once Segregated Witness is activated on the Bitcoin network. That said, in the initial stages, the Lightning Network should only be used for small payments as the network and software are stress-tested. Currently, the Lightning Network is being tested on the Bitcoin test network. Initially, some aspects of the Lightning Network will be difficult for end users to use, but over time these aspects will be developed to make them easier to use. However, people should be able to make instant payments, especially instant small payments, which can significantly expand Bitcoin adoption in the future. In the long term, the Lightning Network has immediate value in enabling traders to instantly move Bitcoin between exchanges, bringing a better user experience to Bitcoin, more similarity to existing payment flows (instant payments, invoicing), and enabling true micropayments. I believe micropayments are one of the big killer apps for Bitcoin, and the Lightning Network will make that a reality in the coming months.
8btc: What do you think of the current completion status of the several time points mentioned in the consensus signed at the roundtable meeting held in Hong Kong in February 2016? Joseph: Since I have not attended the Hong Kong Consensus discussion, I am not familiar with the details, and consequently, my interpretation is as valid as anyone else. With regards to the discussion around the agreement, I tend to take a neutral position. I think a lot of work and effort has been placed by all parties to find a good solution for what is best for Bitcoin. Segregated Witness is several weeks if not days away from being finalized and Luke-Jr has done some great research and produced code around what a possible hard-fork would look like. My hope is that the community can move forward to resolve all aspects of the agreement in common and continue developing future improvements in Bitcoin. There are a lot of new technologies, businesses, and use cases which help bitcoin adoption, resolving this from the development side as soon as possible as well as having the community understand this as resolved is the best way to bring about efforts which can help make Bitcoin a valuable currency for all. I think a lot of work and effort has been put into finding the best solution for Bitcoin. Segregated Witness was not finalized today, it was finalized in weeks. Luke-Jr did some great research and code around a possible hard fork. Since I was not present at the Hong Kong consensus discussion, I am not aware of the details of the meeting. Therefore, my interpretation is the same as others. Regarding the discussion of the protocol, I tend to take a neutral position. My hope is that the community can resolve various aspects of the protocol and continue to develop more improvements for Bitcoin. There are many technologies, enterprises and use cases that can help Bitcoin adoption, and solving this problem as soon as possible from the development level and letting the community understand is the best way to help Bitcoin become a valuable currency for everyone.
8btc: What do you think of the Ethereum fork? Do you think it has reference significance for Bitcoin? Joseph: I think the Ethereum Hard Fork is incredibly interesting. I think the lessons learned from a hard fork with significant value behind it is immense and directly helps the wider community understand the impact and upside/downside risks for all cryptocurrencies. I think the Ethereum hard fork was very interesting. The lessons learned from this hard fork are of great value and directly help the broader community understand the impact and upside/downside risks of hard forks on all cryptocurrencies.
8btc: Is this your first visit to China? Is there any special reason for coming this time? What do you think of the Chinese digital currency community? Joseph: I've been to China many times and look forward to many more, I really enjoy visiting and seeing the sights, people, and the food. I went this time to meet the wider cryptocurrency community in China. I think the Chinese cryptocurrency community is very dynamic and has a great deal of creativity around building leading businesses in this space. Shanghai and Beijing certainly have one of the most activity in this space compared to anywhere I've visited. I have been to China many times and look forward to many more. I really enjoy visiting China, seeing the sights and tasting the food. My visit to China will be to meet with the vast Chinese cryptocurrency community. I think the Chinese cryptocurrency community is very active and very creative in creating leading companies in the industry. Of course, Shanghai and Beijing are the most active cities in the region I visited.
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