🏢ONCHAIN ​​AND LIGHTNING: UNDERSTAND THE DIFFERENCE 🏢

🟠 As we know, $BTC is a decentralized network with the goal of making money anonymous, generating P2P (peer-to-peer) privacy where you would be your own "bank", having possession of the 12-24 word key

⚡ With that, when analyzing Bitcoin in more depth, we understand that there are two layers: onchain (1st layer) and lightning (2nd layer)

Let's better understand the difference between the two?

Onchain:

🟧 - All transactions are recorded on the Bitcoin blockchain, which guarantees the security and immutability of transactions

👷 - Validation by miners: all transactions are validated by miners (computers), who compete to solve a complex mathematical problem and validate the transaction, currently receiving a reward of 3.12 BTC

💲 - Fees: fees are paid for the miner's service, and are higher than Lightning's, at $4

⏳ - Confirmation time: confirmation time is approximately 10 minutes, depending on the network load

Lightning:

🔐 - Off-chain transactions: transactions are carried out outside the blockchain, and are commonly used for daily payments

🧔‍♂️🧔‍♂️ - Validation by participants: transactions are validated by channel participants, without the need for miners

- Lower fees: fees are quite low compared to Onchain, being $0.10

🪜- Scalability: The Lightning Network is designed to be more scalable than the Onchain Network, as it can process a large number of off-chain transactions.

😉 Do you understand the differences between the two? In short, Onchain is recommended for holders and people who want to leave their BTCs in the long term. Lightning, on the other hand, is for everyday payments, which are practical and fast.

So, what did you think of the post?

Have you already self-custodied your BTC?

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See you soon and happy investing 😁