hree startups are getting ready to launch one of the most ambitious and important cryptocurrency experiments since the creation of bitcoin itself. Called Lightning, the project aims to build a fast, scalable, and cryptographically secure payment network layered on top of the existing bitcoin network.
Essentially, Lightning aims to solve the big problem that has loomed over bitcoin in recent years: Satoshi Nakamoto's design for bitcoin is comically unscalable. It requires every full node in bitcoin's peer-to-peer network to receive and store a copy of every transaction ever made on the network.
Initially, that design was vital to achieving Nakamoto's vision of a fully decentralized payment network. But as Purdue computer scientist Pedro Moreno-Sanchez told Ars, it creates a big challenge as the network becomes more popular. "We have reached a point where it's not suitable any more to keep growing," he said.
Lightning could offer a way out of this bind. It shifts routine payments outside of the blockchain, clearing away the most significant obstacle to bitcoin's continued growth.
In fact, the Lightning project could potentially do much more than that. Lightning payments are expected to be faster, cheaper, and more private than conventional bitcoin payments. Proponents see Lightning as a new, second layer in the bitcoin software stack. They hope Lightning will expand the appeal of bitcoin in much the same way the Web helped the Internet go mainstream.