So, I was thinking about how Lightning Network doesn’t really have a public balance like Bitcoin does. I mean, in regular blockchain, you can see everything, but not here. How can someone prove they have a certain amount of BTC when it’s all private? 🤔
Can HTLCs Prove Solvency in Lightning Network?
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Interesting thought about using Hash Time-Locked Contracts (HTLCs) for solvency proof. But how do we make sure both parties do their part? Maybe we could use multisig to link the transactions. Like, both A and B would have to approve the deal, right? Plus, a timeout feature could protect against scams. If things aren’t done in time, funds go back.
You’re onto something, but LN kinda complicates this. The preimage doesn’t really lock the two payments together. If A pays first, B might just bail. And if B goes first, A could just take the funds. There’s no built-in way for both to succeed or fail at the same time, which is kinda a big deal.
Yeah, I thought multisig could work too at first, but then I realized it wouldn’t help much. LN is about punishing people for trying to empty channels. But a verifier (B) might not even have balance or could move their funds away before A sends. So A could try to close the channel but really, what’s the point?
I see it differently. LN relies on knowing if routes are valid, right? If you can trust a verifier to check balance, they could probe payments through their channel. It’s kinda like proving solvency on-chain, where you check if the funds are there before moving.