Ethereum: A SECWIT -based side chain as a ray network allows a fractional reserve?
As the world of decentralized finances (Dead) continues to develop, several side chains have emerged that promise to improve the functionality and usability of the different blockchain networks. One of those side chains is the original lateral chain of Ethereum Network, which has recently reached significant attention. In particular, I mean SECWIT -based lateral chains as a lightning network.
What are Segwit and side chains?
Before immersing yourself in this issue, it is crucial to understand two basic concepts:
- SEGWIT (segregation of poorly confirmed transactions) : This refers to a feature that allows validators to the blockchain network to separate the poorly confirmed transactions from which the network has accepted. SEGWIT allows more effective and scalable validation processes.
- Side chains : The side chain is an independent parallel blockchain network that can be used for certain purposes or to enable new applications. The side chains offer several advantages over traditional parents, which include greater scalability, a faster transaction processing time and better security.
Lightning network: definitive side chain
Craig Wright, an Australian entrepreneur behind the Lightning Network (LN), discussed his decentralized vision, without a financing permission that uses Blockchain technology. LN is an open side chain that allows fast, cheap and safe payments among users without the need for intermediaries.
The LN uses a segregated witness (secwit) to confirm transactions, which improves the speed of transactions wrapping and reduces the risk of 51% of the attacks. This feature has significant implications in defense applications, including loans, loans and shops.
FEATHER BANK BANK
Now, let’s talk about how the side chain as Lightning can relieve a fracture spare bank:
* faction reserve : In traditional banking systems, deposits are usually made in all units (for example, 100 USD), and the bank only had a fraction of that amount in reserve. This practice provides liquidity and reduces the risk of starting a bank.
* Banking faction reserves in blockchain networks
: A side chain such as lightning can allow fractional banking reserves, allowing users to deposit funds in smaller quantities while maintaining most of the reserve. This procedure is facilitated by SEGWIT, which improves the transaction wrap rate.
In this scenario:
- Customers place small amounts of ether (eth) or other assets
in the side chain.
- The side chain confirms these deposits using Segwit , ensuring that the transactions are duly secured and tested.
- The proportion of the deposited amount remains in reserve , while the rest is available for use in the Nenet.
Benefits and Restrictions
A combination of a side chain, such as a ray network and a faction reserve bank, offers several advantages, which include:
- Greater availability of financial services
- Reduced costs associated with traditional bank infrastructure
- Improvement Efficiency and Scalability
However, there are also restrictions that must be considered:
* Regulatory challenges : The use of blockchain technology in the definition of applications is not yet regulated.
* Security risks : As with any decentralized system, there is a risk of safety or violation of characteristics.
Conclusion
In conclusion, a combination of SECWIT -based side chains, such as the Lightning and Fractional Reserve Network, offers a promising solution to improve financial services. Although there are regulatory challenges and safety risks, they can be mitigated through careful planning and implementation.