Full mesh banking payment channel network

#1

I shared an idea here half a year ago. I put together a good website now, plus script, and tools to analyze the idea: https://meshnet.grok.me. By simplifying the network topology to a full mesh banking network, and then customers as spokes on banks, you get rid of chained timeouts and path-finding. Staggered deposits - which scale poorly (exponentially) as 2^N-1 but when used for only two hops they work, replace the chained timeouts. A timeout remains on last hop - there it is harmless for the “risk pay out without pay in” issue, on timeout payment simply never starts (with staggered deposit there instead, they would reach 7N, timeout better since on last hop timeout is not that problematic).

On https://meshnet.grok.me/scale, you can see optimal numbers of routers relative to payment channel size for customers and inter-bank. It tends to be very high number of routers, more than might be intuitive. Thousands. Tens of thousands. Very decentralized. With 5K per customer and 100K per inter-bank, 22K routers. 22K regional banks, each autonomous and trustlessly doing transactions with other banks to their customers, with trustless transactions with its customers. This means more speed. 22K regional banks with at least thousands of TPS between them, is millions of TPS and more.

The timeout length, boils down a bit to trust (or, proven tendency to not exploit it by refusing to release preimage, thus locking 3N deposit at your banks inter-bank channel for timeout duration). So without trust, shorter timeout. With some trust, longer.

#2

Interesting idea. I think the main question for everyday users is whether it feels simple and reliable in practice. People will want to know what they need to do to get started, what it costs, and what happens if something goes wrong.
A simple real-life example could make the idea much easier to understand.

#3

What about it do you find hard to understand? You have a real example with scripts. The site has a simulator. What more real example do you need?

As it has no chained timeouts, the assumption “things can go wrong” is misunderstanding things. What could go wrong for you, during Prepare when your bank has staked as much as you have, that bank might explode and lose its private keys. But, this is not some every day scenario. It’s irrelevant. But if that happens, yes the amount you tried to send is locked forever. Just like it would be if you lost your private key… It’s a “double deposit” escrow. For last hop with timeout, what “can go wrong” is payment never starts, or, the seller is dumb enough to post the preimage after timeout which means the two first hops succeed. The buyer is still entitled to the product, since they paid and responsibility to not fuck up revealing condition was on seller.

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#4

An update. It’s trivial to run this not only for one crypto-coin, but “inter-ledger”. Payment channels, inherently, can be “inter-ledger” (allow hops between ledgers) as long as they’re doing exchange rates. This is rarely discussed, it seems, “Interledger” ignored the intra-ledger part while Lightning and such ignored the inter-ledger part. This simplified architecture, done as “inter-ledger”, might be a “sweet-spot” in complexity-to-benefit, at least short term (next 10-40 years), plus liquidity is higher than for generalized multihop (Lighthing etc, note my 3-phase is the optimal for that). I’m myself thinking it might be people will use this intermediary solution for intermediary size payments (it is intermediary level in centralization of liquidity), on-chain for large payments, and off-chain for small payments.

I put up a concept for this all as an inter-ledger system: https://solomon.grok.me. This means it could launch for any blockchain - but - scale up to connect hubs between blockchains. My interest in that is when “national blockchains” secured by “one person, one unit of stake” start to take off - as that makes universal basic income easy to manage, and these typically scale better for small countries when population register is a hierarchy. Such a generalized architecture example is on https://hiercoin.org (today I might change 1 or 2 design decisions there but overall it’s fairly good as a concept).