Antoine Riard, who exited the Lightning Network last month, claims it is also in danger of becoming progressively centralized and vulnerable to single failure points and censorship risks.
An ex-Lightning Network developer asserts that developers involved in the Bitcoin layer-2 Lightning Network are hardly security-oriented. Instead, they are focusing on cash flow production for their investors.
Bitcoin Developer Outlines Lightning Network Challenges
Last month, Antoine Riard, a Bitcoin core developer and security researcher, made headlines following his exit from the Lightning ecosystem. This happened due to concerns regarding ‘replacement cycling,’ a new attack vector used by exploiters to siphon funds by targeting payment channels.
At that time, Riard claimed the new category of attacks placed Lightning in a ‘dangerous position.’ However, the rest of the Bitcoin developers, for instance, ‘Machine98,’ claimed it was a complex attack to execute.
Richard said that, at present, he is working at the Bitcoin base layer to rectify the problem and requested Lightning developers to do the same. Further, he said that most Lightning-focused companies are pleasing venture capitalists (VCs) by weakening Lightning’s security incentives and values.
Specifically, he said that most of them work for VC-financed or commercial entities with similar low-time preferences, at the end users’ long-term disadvantage. Riard also claimed this is a typical ‘tragedy of the commons’ example that involves entities and persons with public resource access acting in their interest and exhausting it.
Lightning Network Suffers Security Concerns
The VC-financed Lightning companies prefer decentralization as the compromise, and Richard is quite concerned about this. He said that centralized systems are excellent on the efficiency scale. Nevertheless, they have disadvantages such as systemic single-point-of-failure and reduced user control costs. One may wish to hedge such fundamental risks against a Bitcoiner.
Riard said he is uncertain if that is an exciting future for Lighting. Further, he said this is something he does not intend to be a part of following his exit from the Lightning ecosystem on October 20. Specifically, he said he does not want to be linked with being responsible or in charge of the Lightning Network security and the estimated 5300 exposed Bitcoins.
Very little can be done to stop the loss without affecting the fundamental values of permissionless and censorship-resistance of the Lightning Network.
Significance of Lightning Network
The Lightning Network is the second-layer solution established over the blockchain, and its design enhances Bitcoin’s efficacy and scalability. Users can utilize the Lightning Network to open payment channels, carry out several off-chain transactions, and settle the outcome on Bitcoin.
The replacement cycling attack refers to one that permits an attacker to steal a channel participant’s funds by relying on vulnerabilities between the pools. Despite a request for comment, Lighting Labs and other participants in the Lightning ecosystem failed to provide any.
Despite the security worries and possible shift toward centralization, Riard said that Lightning has not witnessed as numerous attacks as witnessed in Ethereum layer 2s. He explained the contrast of exploits frequency since at any particular time, the amount of funds stored in the users’ wallets is small.
DefiLlama’s data indicates that the amount of Bitcoin locked in the Lightning Network is $194.1M. Such represents a small amount relative to the amount locked in a single Ethereum Layer 2.
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