This information will present you how you can rapidly and simply shield your funds in your Bitcoin Lightning channel.
The Lightning Community is a trustless* Layer 2 community for Bitcoin and brings forth many enhancements in pace and value of ultimate settlement. I exploit an asterisk on trustless as a result of though it’s, there are a number of caveats to think about in order that your funds are secure, except for regular sizzling pockets dangers. Watchtowers, which we’ll cowl at this time, make sure that your funds are secure from malicious channel closures, which is among the essential dangers of operating a well-capitalized Lightning node.
Lightning channels are at the moment constructed by means of establishing a two-of-two multisig tackle, during which your funds are locked up with one other celebration. Both celebration has the key to revoke the multisig contract and settle up at any time, however provided that each nodes are on-line can it’s closed instantly. In case your node did go offline, the opposite celebration has to both wait so that you can come again on-line or power shut the channel. Now, power closing just isn’t all the time an enormous concern, particularly in case you’re utilizing the Lightning Community with friends that you just belief already, however because the Lightning Community grows and its use circumstances broaden, you’ll inevitably begin interacting with friends whom you might not know, and so it is essential to study to defend your node towards malicious closures.
If a malicious peer had been to shut a channel with a false stability state, and you do not come on-line to rebroadcast and declare the precise stability inside sufficient time, they’ll get your entire funds within the channel. Watchtowers shield towards this by maintaining a operating tab of your channel balances and defending towards malicious closures. If a nasty actor had been to shut a channel whilst you have a watchtower energetic in your Lightning node, they may immediately be penalized by means of what’s referred to as a justice transaction as an alternative of you, and you’re going to get all of their funds as an alternative of them getting yours.
On this video, we clarify how watchtowers work to guard your funds inside Bitcoin Lightning channels and present you ways to hook up with Voltage.Cloud’s free, LND Tor-based watchtower service.
This considerably reduces the operational threat of operating a capitalized Lightning node in my view. Whereas it doesn’t essentially scale back the danger of power closures on a crashed node with static backups and will nonetheless be an costly incident to get well, a minimum of it will shield your funds towards malicious channel companions who could attempt to steal your funds if a {hardware} failure occasion had been to happen.
Presently Voltage.Cloud runs this service altruistically, too. Fairly candy, huh?
Thanks for testing our video. Full steps under.
https://www.youtube.com/watch?v=tmgh18QE4eA
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1) Right here is the code so as to add to the underside of lnd.conf file:
[wtclient]
wtclient.energetic=true
2) Then, after you restart, run from root by way of SSH:
docker exec -it lnd lncli wtclient add 0301135932e89600b3582513c648d46213dc425c7666e3380faa7dbb51f7e6a3d6@tower4excc3jdaoxcqzbw7gzipoknzqn3dbnw2kfdfhpvvbxagrzmfad.onion:9911
3) Lastly, to verify the watchtower is energetic run:
docker exec lnd lncli wtclient towers
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Video Timestamps:
0:00 Intro
0:30 Watchtowers defined
2:27 Downloading PuTTY to entry node by way of command line
3:20 Modifying lnd.conf file by way of SSH
5:40 Restarting node
6:05 Including Voltage.Cloud’s Tor Watchtower by way of SSH
7:05 Verifying the Watchtower was efficiently added
7:37 Watchtower privateness
8:22 Outro
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