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improvements to chapter "Commitment Transaction", part 2 (#189)

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- comma after however
- when referring to time "immediately" is better and more meaningful than "directly"
- when referring to time duration "lasts" is better than "is"
- consistency: "channel partner" better than "party"
- etc
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@ -205,21 +205,24 @@ A key characteristic of bitcoin is that once a transaction is valid, it remains
We will now see how such a penalty mechanism can be included to the above construction of the commitment transactions. We will now see how such a penalty mechanism can be included to the above construction of the commitment transactions.
Usually the commitment transaction has at least two outputs, one for each partner. Usually the commitment transaction has at least two outputs, one for each partner.
However a channel partner will encumber their own output with a timelock and a revocation secret. As new addition, a channel partner will encumber their own output with a timelock and a revocation secret.
The timelock prevents the owner of the output to spend it directly once the commitment transaction was included in a block. The timelock prevents the owner of the output to spend it immediately once the commitment transaction was included in a block.
The timelock is usually measured in blocktime and can be up to 2016 which is statistically speaking two weeks (assuming a blocktime of 10 minutes which is the target for the Bitcoin network). The timelock is usually measured in blocktime and can be up to 2016.
Within the timelock anyone who knows the revocation secret can spend the output even well before the timelock was over. On average, 2016 blocks represent or last two weeks (assuming a blocktime of 10 minutes as in the Bitcoin network).
Alice and Bob know only one half of the revocation secret but if they share their half with the other party, the other party knows the full secret. Within the timelock anyone who knows the revocation secret can spend the output even before the timelock is over.
Alice and Bob know only one half each of the revocation secret.
But if they share their half with the other channel partner, theh the other partner knows the full secret.
In order to update the balance and receive a signature from Bob, Alice will have to share her half of the revocation secret of the current commitment transaction with Bob. In order to update the balance and receive a signature from Bob, Alice will have to share her half of the revocation secret of the current commitment transaction with Bob.
Obviously for every new update of the channel balance new revocation secrets have to be created and the old ones all need to be saved. Obviously, for every new update of the channel balance new revocation secrets have to be created and saved.
Luckily the secrets are rather small and it is only the channel partners who need to do that, not the entire network. As long as a channel remains open, all revocation secrets ever created for this specific channel need to be keep as they might be needed in the future.
Still managing the revocation secrets is one of the more tricky parts of Lightning nodes that hinders node operators to maintain backups. Luckily, the secrets are rather small and it is only the channel partners who need to keep them, not the entire network.
Watchtower services or switching to the aforementioned eltoo channels might be future strategies to mitigate these problems. Nevertheless, managing and storing the revocation secrets is one of the more elaborate parts of Lightning nodes that require node operators to maintain backups.
Other technologies such as Watchtower services or switching to the aforementioned "eltoo" channels might be future strategies to mitigate these issues.
With the timelocks in place Alice can close the channel at any time if Bob does not respond. With the timelocks in place Alice can close the channel at any time if Bob does not respond, claiming her fair share of the balance.
She has to wait for the time lock until she can spend her funds from the commitment transaction after the commitment transaction has a confirmation. After publishing the commitment transaction "on-chain" Alice has to wait for the time lock to expire before she can spend her funds from the commitment transaction.
Other than that and the fees for opening and closing a channel there comes no additional burden with maintaining a payment channel. Other than that and the "on-chain" fees for opening and closing a channel there comes no additional burden with maintaining a payment channel.
==== Announcing the channel ==== Announcing the channel
Channel partners can agree to publicly announce the channel over the gossip protocol that comes with the Lightning Network. Channel partners can agree to publicly announce the channel over the gossip protocol that comes with the Lightning Network.