Running your own node is definitely a friction point but with lightning the bigger friction point seems to be liquidity management, particularly inbound liquidity.
Many of the people using ‘non custodial mobile wallets’ such as phoenix still have to trust the company that is running the node and providing them liquidity.
The concern I have is that we are onboarding a ton of people via custodial wallets and standardizing LNURL which has incentives pushing people toward custodial wallets.
Eventually these custodians will rug pull or shotgun kyc. It is difficult to reverse this course after the fact.
Replies (14)
does having multiple custodial wallets mitigate this risk?
What’s the best solution to manage liquidity? Any interesting projects to support there?
Most people just want low cost frictionless money, and if they are being onboarded by buying $30 of BTC experimental spending money with their Debit Card via the getalby top up, they really don't even have to care about deeper issues.
Don't make perfection be the enemy of the good enough.
I agree
💯
LNURL pushes people towards hosted/custodial wallets. It’s better than the alternative. I just wish bolt12 was more widely adopted. I dont hold lnurl against anyone. Its a tool that exists today and works. But the reliance on a clearnet webserver comes with tradeoffs.
Leaving KYC issue aside, since *all* my coins are KYC 😉 , am I right in interpreting a hot custodial wallet greatest risk is simply losing the coins in it? So a balance risk management problem.
I don't really know about Phoenix, is it same than Breez wallet (neutrino). If the devs want to rug pull, can they steal all the satoshis of their clients ? Neutrino makes spawm a node on your android, and you have private keys to spend on the channel, so they could prevent you from spending but I don't see how they can steal funds
If fees are zero and transactions are instant, what prevents users from jumping ship? Is it just a race at that point?
Sadly I think that most people will use lightning integration on their already kyc payment app when it is integrated. Most people won't care until something bad happen
CLBOSS fixes this.
Is there a way to like this tweet?
Yes Phoenix is very much like breez. You can even force close your channels and back up from the on-chain seed phrase.
However, Phoenix does allow ACINQ to publish an old channel state so that's one of the risks. Still a better model than full custodial in my opinion.
Yes Phoenix is very much like breez. You can even force close your channels and back up from the on-chain seed phrase.
However, Phoenix does allow ACINQ to publish an old channel state so that's one of the risks. Still a better model than full custodial in my opinion.
Yes Phoenix is very much like breez. You can even force close your channels and back up from the on-chain seed phrase.
However, Phoenix does allow ACINQ to publish an old channel state so that's one of the risks. Still a better model than full custodial in my opinion.
