[Lightning-dev] Proposal: Decentralized Service Provider

Samuel Kremser sam at kremser-crypto.org
Fri Mar 11 08:49:49 UTC 2016

Hi Guys!

I wanna make a improvement proposal for the Lightning Network and would 
like to hear your thoughts about it.
I am calling it: Decentralized Service Provider (DSP).

A Decentralized Service Provider (DSP) could grant end users access to 
the Ligthning Network, so they wouldn't have to validate
the Blockchain or care about closing times of channels. Also end users 
would enjoy the benefit of propably much larger
(filled with more Bitcoins) channels which allows them to send and 
receive more money, since all users of one DSP would share their channel(s).

Each DSP consists of several entities (propbly also geographically 
These entities manage the DSP's tasks in a collaborative way.
These Tasks are:
1. Managing Bitcoin deposits and withdrawals
2. Managing the Lightning Network Channel(s)
3. Managing communication with end users and the Lightning Network

Deposit addresses for the DSP are multi-sig addresses, so that a 
majority of a DSP's entities is required to sign withdrawals.
Also the Lightning Network channels are managed in this multi-sig 
style   .....erm.....  yes i am aware that Lightning Network channels
are multig-sig anyway, what i wanted to say is: a update to the channel 
reqiures now a majority of the DSP's entities to singn AND
the other side of that channel to sign. In case both sides of the 
Lighting Network channel are DSPs the majority of both DSP's entities 
need to sign.

Due to this multi-sig construction a single entity of a DSP couldn't 
steal the end users Bitcoins. It would actually reqire the majority of 
entities of
one DSP to collaborate to steal the end users money.

DSP's entities communicate with signed messages with their end users and 
with each other, so everything is provable. Whenever some entity of a DSP
is acting malicious the other entities of that DSP can decide to exclude 
this entity from this DSP by transferring control of the managed 
Bitcoins and
channels to some new multi-sig address(es)/channel(s) that doesn't 
require the malicous acting entity's signature.
This could also be done if one entity isn't reliable available.

Another advantage of DSP's would be that fewer channels are reqired, 
since not every end user needs his own channel. Thus DSPs could save even
more space on the Blockchain than Lightning alone.

Thanks for your attention!


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