{"id":250,"date":"2019-02-27T14:44:24","date_gmt":"2019-02-27T13:44:24","guid":{"rendered":"https:\/\/www.codemotion.com\/magazine\/lightning-network-the-second-layer-of-blockchain-is-ready\/"},"modified":"2020-01-31T11:28:27","modified_gmt":"2020-01-31T10:28:27","slug":"lightning-network-the-second-layer-of-blockchain-is-ready","status":"publish","type":"post","link":"https:\/\/www.codemotion.com\/magazine\/backend\/blockchain\/lightning-network-the-second-layer-of-blockchain-is-ready\/","title":{"rendered":"Lightning Network, the second layer of Blockchain is ready"},"content":{"rendered":"

B<\/span>lockchain: wherever it\u2019s spoken, wherever it\u2019s discussed, many argue about the economic aspects of cryptocurrency<\/span>. But what exactly is blockchain technology? During his talk at Codemotion Milan 2018, Paolo Moro<\/a> explained to us in detail the nature of blockchain and its future implications.<\/p>\n

This technology is composed by a growing list of records, called blocks, which are linked using cryptography<\/span>. Each block contains a cryptographic hash of the previous block, a timestamp, and transaction data (generally represented as a merkle tree root hash). Basically, blockchain is an open and distributed register that can store transactions between two parties in a safe, verifiable and permanent way. Thanks to these features<\/span> many industries and companies have radically changed their strategies<\/span> to exploit this technology in the most intelligent ways. Through Blockchain it is, therefore, possible to improve the security<\/span> live, thanks to data encryption, making the interchange networks more robust, facilitating the verification of the transitions and the identity of the users.<\/p>\n

Blockchain networks use a series of computer algorithms mathematically tested to eliminate security risks derived from human errors. In general, there are two forms of software infrastructures based on Blockchain: public and private. In the first, all participants are responsible for data storage and verification of transitions. In private cases, on the other hand, tests for the verification of transactions belong to a selected group of nodes and, in order to access such networks, a user must be invited to participate by another user or be included in a group chosen since creation of its own reference network.<\/p>\n

Most probably private networks are less “democratic” than public ones, but in any case they seem to represent the ideal solution for companies<\/span> (like banks). The advantage of networks that implement Blockchain technologies is that they can be completely decentralised and distributed, Thanks to these characteristics, these networks can escape a vast plethora of attacks, such as DDoS (Denial-of-service attack).<\/p>\n

The decentralisation of the networks is a not indifferent aspect. In fact it ensures a greater level of security<\/span> both for users and for companies<\/span>, who can devote themselves to other aspects of their projects<\/span> without having to always adopt new countermeasures to stem the attacks that are commonly launched against traditional networks. So the Blockchain technologies can help to boost cybersecurity in many fields.<\/p>\n

For example, Blockchain could improve the security<\/span> of the election system. In fact a Blockchain voting system would use a token-based approach that automatically ensures that each person gets only one vote and, once it enters the ledger, it\u2019s permanent and unchangeable.<\/p>\n

Blockchain can also revolutionise the world of contracts, using smart contracts Blockchain could eliminate the need for lawyers in some contract negotiations. This self-executing digital contract can be stored, replicated and managed by a computer network. It is also possible to manage the various contractual details such as payment, products and services.<\/p>\n

For business-to-business transactions, Blockchain technologies allow the instantaneous transfer of currency and all the various intermediaries are eliminated. Another sector deeply changed by Blockchain is tradable certificate. The governments of many countries use this type of certificate to measure the levels of energy produced from renewable sources. In the past, tradable certificate required multiple steps of administrative and bureaucratic paperwork. Blockchains have greatly simplified the detection and transmission of data<\/span> on renewable energy sources and their respective energy grids. Also, they encourage individuals to adopt similar solutions with the installation of household equipment.<\/p>\n

Obviously, Blockchain reduces costs in banking transactions, because it simplifies the process of authenticating the parties involved while keeping personal information secure.
\nAlso, since there are few or no humans<\/span> involved, the process is much faster and the process could be done in a few seconds.<\/p>\n

So the cryptocurrencies<\/span>, like Bitcoin, are just the tip of the iceberg. However Bitcoin can help us understand how services based on Blockchain networks work.
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\nAs explained by Paolo Moro, companies<\/span> are well aware of these capabilities of Blockchain networks. In fact, around such technologies were born projects<\/span> like Lightning Network, that can be defined as a second layer of Blockchain. The Bitcoin Blockchain is a public ledger that records Bitcoin transactions. These transactions are defined using a Forth-like scripting language and consist of one or more inputs and one or more outputs. When a user sends Bitcoins, the user designates each address and the amount of Bitcoin being sent to that address in an output. To prevent double spending, each input must refer to a previous unspent output in the Blockchain. The users of this network keep their Bitcoins inside a wallet, which stores the information necessary to transact Bitcoins.<\/p>\n

The cryptocurrency wallet also has specific functions:<\/p>\n