IRB Media

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#1 The Lightning Network is a network of payment channels that allows users to make instant, off-chain payments. It is a layer above the Bitcoin blockchain that allows people to transact quickly and securely.

#2 A payment channel is a financial relationship between two nodes, called the channel partners, that allocates a balance of funds between the two channel partners. The cryptographic protocol ensures that one channel partner cannot cheat the other.

#3 The payment channel is based on a 2-of-2 multisignature address on the Bitcoin blockchain, for which you hold one key and your channel partner holds the other key. You and your channel partner negotiate a sequence of transactions that spend from this multisignature address.

#4 The Lightning Network is a comprehensive communication protocol that allows peers to exchange Lightning messages to achieve the transfer of bitcoin. The communication protocol defines how Lightning messages are encrypted and exchanged.

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