#6 - Exploring Layer 2 Solutions on Bitcoin
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#6 - Exploring Layer 2 Solutions on Bitcoin
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In this episode, David Wong interviews Kevin Hurley and Alex Akselrod to discuss layer 2 solutions on Bitcoin. They explain that layer 2 (L2) is a scalability solution that sits on top of the Bitcoin blockchain and adds additional functionality and programmability. They discuss the history of L2s, mentioning Namecoin and colored coins as early examples. They also explore the distinction between L2s and sidechains, with L2s typically allowing for unilateral exits and sidechains relying on federations or merge mining. They mention projects like Blockstream, Stacks, and Rootstock as examples of L2s or sidechains on Bitcoin. The conversation explores the concept of multi-signature (multi-sig) and its role in layer 2 (L2) solutions like Liquid. It also delves into the workings of the Lightning Network, which enables instant and low-cost transactions on Bitcoin. The Lightning Network operates through payment channels, where users can push 'beads' (Satoshi's) back and forth. The conversation also touches on the challenges of centralization in Lightning Network and the role of LightSpark in making Lightning more accessible and user-friendly.