Everyone is buzzing about Bitcoin’s lightning network…
But...don’t other platforms need their own version/implementation of the lightning network, since most blockchains have inherent scalability issues..?
Today’s review is of the Raiden Network..and we will see if they can effectively be the lightning network for Ethereum.
Let’s dig in…
Raiden Network Token (ticker: RDN)
Wtf is this shit?
The Raiden Network is an infrastructure project aiming to be the lightning network for Ethereum, specifically to transfer ERC-20 tokens. Much like Bitcoin’s lightning network, the Raiden Network is made up of payment channels to facilitate transactions off-chain.
Briefly speaking, “The Raiden Network allows secure transfers of tokens between participants without the need for global consensus. This is achieved using digitally signed and hash-locked transfers, called balance proofs, fully collateralized by previously setup on-chain deposits.”
These balance proofs are quite literally, proofs of balance. The Raiden Network takes on a collateralized approach. These payment channels allow for bidirectional, unlimited transfers between two users as long as the net sum of transfers does not exceed the amount of deposited tokens in the smart contract of the payment channel. Once a payment channel closes, the net resulting transactions are published to Ethereum’s main blockchain. Additionally, when a payment channel opens, this event is published to the main chain.
These payment channels DO NOT need to be direct to each user...it would not be scalable if every participant needs a payment channel direct to one another. Instead, transfers can be sent through various channels as long as there is a route to get to the end recipient. Funds are safe and cryptographically signed - “hash-locked” transfers.
In the end, they hope to take the load off the main chain and promote scalability along with cheaper and faster micropayments.
Our main criticism is that we think they could have approached this in a way more directly similar to Bitcoin’s lightning network where you just need Bitcoin (in this case, Ether) to use the payment channels...not RDN.
Who tf is behind this shit?
Not easy to find individuals, but the company behind Raiden (Brainbot) is based in Germany. Brainbot is a company focused on developing blockchain technology.
All in all, mid-tier shitcoin, mostly due to market metrics...we wish them luck.
Hope you learned some shit and be sure to follow us on Twitter!
- Mike and Aaron