What is the Lightning Network?

At some point in history, sending a telegram was the quickest and most efficient way of long-distance communication. To do so, you had to go to your local post office, fill in a form and pay for your message based on how many letters it contained. Then, the message would get telegraphed to the nearest telegraph office for transmission to the distant end. A postman would then deliver the telegram to its destination.

Basically, there were a lot of people involved in sending a simple short message and you had to pay quite a bit of money for it. That’s pretty much the current state of the Bitcoin network. In this analogy, the Lightning Network is essentially like having a person you want to talk to on speed-dial: you just need to press ‘1’ and your friend’s phone is already ringing.

To put it simply, the idea behind the Bitcoin Lightning Network might’ve sounded something like this: we really don’t need to keep a record of every single transaction on the blockchain.

Instead, the Lightning Network adds another layer to Bitcoin’s blockchain and enables users to create payment channels between any two parties on that extra layer. These channels can exist for as long as required, and because they’re set up between two people, transactions will be almost instant and the fees will be extremely low or even non-existent.

cointelegraph.com

What is the Lightning Network?
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