Larger Lightning Network channels with Wumbo

The Lightning Network is becoming more and more mature: Lightning Labs integrated support for ‘Wumbo channels’ in the latest version of the LND software. Wumbo enables payment channels with a larger capacity.

LND is software that allows users to set up a Lightning node to participate in the Lightning Network. Lightning Labs released its first version two years ago, after which the first users could get started with the Lightning Network.

Because the Lightning Network is a new and experimental technology, Lightning Labs in LND had set limits of up to 0.1677 BTC per channel to protect users. With this they wanted to limit the risks and prevent users from creating too large channels before the software had been thoroughly tested.

Wumbo

The use and extensive testing over the past two years has apparently increased confidence in the software, as the latest version of LND (v0.11-beta) includes support for Wumbo channels. With Wumbo channels, the aforementioned limits do not apply and channels with a larger capacity are possible.

The total transaction capacity is therefore not necessarily higher, but the transaction capacity per channel is. Previously, larger transactions via the Lightning Network were also possible, but because of the limits, multiple channels had to be used.

With Wumbo this is not necessary and a large transaction can simply be sent via one Wumbo channel. This greatly simplifies channel management, which is especially useful for larger users such as exchanges and other service providers.

“We view shipping wumbo in LND as a sign that the software has progressed to a certain point where advanced users, companies, and node operators can open larger channels. These larger wumbo channels enable a better user experience with larger transactions on the network and more efficient capital usage for startups and node operators,” – Elizabeth Stark, Lightning Labs CEO, interview with Coindesk.

Lightning Labs points out that while the software and the Lightning Network are maturing, there are still certain risks associated with using them. After all, it is still beta software for a relatively new technology. Lightning wallets are also ‘hot wallets’ that are connected to the internet and there is always a certain inherent security risk.

“Note that while lnd and the Lightning Network have come a long way over the last two years, users should still be aware that Lightning wallets are ‘hot’ wallets and are exposed to a variety of risks inherent in storing funds on internet-connected devices . As such, care should be taken to mitigate these risks when possible.” -Bryan Vu, Lightning Labs

Milestone

Wumbo channels are not completely new. Earlier this year, ACINQ’s Eclair and Blockstream’s c-lightning also added support for Wumbo channels. Also, some users had added the functionality to LND’s code on their own initiative.

Still, Wumbo’s official support in LND is an important milestone. According to Elizabeth Stark of Lightning Labs, many large Lightning nodes and start-ups use the official LND implementation. Wumbo will therefore be available for the first time for a large part of the Lightning Network.

The name ‘Wumbo’ is a playful nod to the popular cartoon series SpongeBob SquarePants, in which one of the characters comes up with the word.

“Please blame one of the persons attending the summit for this term. Unfortunately, due to rules imposed, non-attendees can only learn who to blame if that person admits this.” – ZmnSCPxj, Lightning Network developer

Lightning Network

The Lightning Network is a second-layer network ‘on top’ of the Bitcoin network that enables lightning-fast ( ‘instant’ ) and cheap Bitcoin transactions. It is expected that many of the bitcoin transactions in the future will take place via these types of solutions.

Via the Lightning Network, users can open payment channels (also known as: Lightning channels) with each other. This allows them to make transactions with each other and only the opening and closing position is registered on the Bitcoin blockchain. As a result, a large proportion of transactions can take place ‘off-chain’ without the higher costs and speed limitations of ‘on-chain’ transactions, while security is still guaranteed by cryptography.

Read more about the latest version of LND in the release notes or accompanying announcement.

: Neographer, Creative Commons 2.0

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