California startup Lightning Labs has officially launched a beta version of its software (LND), making available what investors and project leads say is the first thoroughly tested version of the tech to date. This means that users can now leverage LND to send bitcoin and litecoin to other users, all without settling those transactions on the blockchain.
This is a watershed moment for Bitcoin development, as it introduces the ability to begin to move everyday Bitcoin payments off the main blockchain and into the Lightning Network, which exists as a second-layer technology on top of Bitcoin and allows users to make payments instantly at almost no cost.
As Lightning Labs CEO Elizabeth Stark explained in an interview with CNBC:
“If bitcoin is like a decentralized savings account, Lightning is a decentralized checking account where users can send money instantly.”
Lightning Network proponents also believe that, once this technology is integrated into other cryptocurrency networks, LN users will be able to more easily make cross-blockchain trades — dubbed “atomic swaps” — an important step in the development
of decentralized exchanges (DEX).
Stark now expects people with the skills to host their own bitcoin or litecoin node to add Lightning Labs’ free software to the mix for quicker, cheaper transactions. Already, there are already roughly a 1,000 nodes running Lightning software on the bitcoin mainnet. Investors in the project believe the release will boost that growing number.
When Stark asked the audience at a recent decentralization summit in Berlin who had already tested Lightning, hundreds of people raised their hands. “We have around 1,800 people on the Slack for LND alone,” she added. “We already have dozens of apps that developers have built.”
Stark’s team built in a few safety measures to limit the amount of cryptocurrency people can send for now to roughly $1,400 worth per channel, or around $400 per payment. The target demographic for the release is developers and “advanced users” who are able to run a full node and use LND’s command-line interface.
Stark went on to warn that users should not experiment with more money than they are willing to lose.
“We were not recommending use on the main bitcoin network before this beta because there are certain features, such as a wallet seed backup, that were not there previously. There are new features included as well, there are bug fixes and stability improvements,” she explained.
But though lnd 0.4-beta is the first LN implementation tagged as ready for mainnet usage, enthusiastic supporters had already begun using LN software.
The Lightning Network has more than 1,000 active nodes, though the network capacity is currently only about 4.5 BTC.
It also became known that the company raised $ 2.5 million from the Jack Dorsey, CEO of Square and Twitter, the executive director of Square Capital Jacqueline Reese, the founder of Litecoin Charlie Lee and former PayPal COO David Sacks.