Rene Pickhardt just lately kicked off a thread discussing the variations between two social gathering and multiparty (greater than two members) fee channels because it pertains to his analysis work round fee reliability on the Lightning Community. He voices a rising skepticism of the viability of that path for improvement.
The excessive stage thought of why channel factories enhance the reliability of funds comes all the way down to liquidity allocation. In a community of solely two social gathering channels, customers need to make zero sum selections on the place to allocate their liquidity. This has a systemic impact on the general success price of funds throughout the community, if folks put their liquidity someplace it isn’t wanted to course of funds as an alternative of the place it’s, funds will fail because the liquidity in locations folks want is used up (till it’s rebalanced). This dynamic is just one of many design constraints of the Lightning Community identified from the very starting, and why analysis like Rene’s is extremely essential for making the protocol/community work in the long term.
In a mannequin of multiparty channels, customers can allocate liquidity into giant teams and easily “sub-allocate” it off-chain wherever it is smart to within the second. Which means that even when a node operator has made a poor choice through which individual to allocate liquidity to, so long as that individual is in the identical multiparty channel with folks that may be peer, they’ll reallocate that poorly positioned liquidity from one to the opposite off-chain with out incurring on-chain prices.
This works as a result of the idea of a multiparty channel is actually simply everybody within the group stacking typical two social gathering channels on prime of the multiparty one. By updating the multiparty channel on the root, the 2 social gathering channels on prime may be modified, opened, closed, and many others. whereas staying off-chain. The issue Rene is elevating is the price of going on-chain when folks don’t cooperate.
Your complete logic of Lightning relies round the concept in case your single channel counterparty stops cooperating or responding, you possibly can merely submit transactions on chain to implement management over your funds. When you might have a multiparty channel, every “stage” within the stack of channels provides extra transactions that have to be submitted to the blockchain as a way to implement the present state, which means that in a excessive price atmosphere multiparty channels will likely be costlier than two social gathering channels to implement on-chain.
These are core trade-offs to think about when these programs in contrast to one another, however I feel focusing solely on the on-chain footprint ignores the extra essential level relating to off-chain programs: they’re all about incentivizing members to not go on-chain.
Correctly structuring a multiparty channel, i.e. the way you arrange the channels stacked on prime, can can help you pack teams of individuals into subsections which have a repute for prime reliability, or who belief one another. This may permit folks in these subgroups to nonetheless reorganize liquidity inside that subgroup even when folks outdoors of it will not be responsive briefly, or go offline because of technical points. The on-chain value of imposing issues, whereas essential, is form of tangential to the core design purpose of an off-chain system: giving folks a motive to remain off-chain and cooperate, and eradicating causes for folks to not cooperate and power issues onc-chain.
It’s essential to not lose sight of that core design side of those programs when contemplating what their future will appear like.
