The Next Lightning Network release will Include Anti-Fraud ‘Watchtowers’

Bitcoin’s Lightning Network (LN) will incorporate anti-fraud ‘Watchtowers’ in their next release as securing the network was long awaited by the users.

Securing the Lightning Network was anticipated by many users who desire faster bitcoin payments and implementing “Watchtowers” should presumably crush many types of fraud attempts on the off-chain network. The next, 0.7 version of the LN software will come later in June and will include Lightning Labs’ fullest build of a network watchtower for the moment.

Until now, when someone used Lightning they had to stay online to be certain that their “counterparty” is not attempting to steal those assets. This quirk has been commonly called out by opponents of the scaling solution, since it is an obvious user experience problem.

What Does the Watchtower Do?

The concept of a watchtower was introduced in the initial Lightning Network whitepaper from 2015 and Lightning Labs have been working on the implementation since the beginning of last year.

In the simplest terms, the main job of a watchtower is to monitor for attempts to broadcast an old state. If someone maliciously tries to do so, stealing funds from counterparties, the watchtower will catch and punish the perpetrator. That way users won’t need to carry out such kind of monitoring by themselves.

The implementation has been led by Conner Fromknecht, Lightning Labs’ head of cryptographic engineering. In April he gave a talk on his team’s design decisions e.g. how they preserve privacy at a virtual lightning conference. 

Lightning Labs CTO Olaoluwa Osuntokun further explains:

“A big factor also [in my opinion] is that now we have a direct deterrence in place against any possible breach attempts, now that the tower code is out there in the open, an attacker now has a very strong disincentive against attempting an attack since it’s very possible that the potential victim has a tower watching their back.”

With the forthcoming release users will be able to observe actual participants that are testing lightning. Osuntokun noted that in contrast to the Bitcoin Lightning Wallet’s watchtowers that are used in the “Olympus Server”, LN’s watchtower can be run by anyone. Osuntokun continues:

“The importance of this release is that once deployed, any routing node can run their own tower to protect their infrastructure, also any business using [lightning network] today can also start to run towers to protect their nodes,”  

Osuntokun believes that the addition of watchtowers will introduce a safer network and will allow users to make payments that were not considered safe before.

Room for Future Improvements

For the upcoming release users that run watchtowers will do it for free. However, Lightning Labs are planning to add fees in order encourage more users to monitor the network, rather than relying on altruistic enthusiasts. Naturally, discussions arise on whether this initiative is needed.

Lightning co-creator Dryja believes that watchtowers will not be used that much if Lightning works as planned. Actively working watchtowers will be a fence against fraudulent actions.

And in order to preserve the privacy of the people who are paying for the watchtowers a new improvement needs to be introduced – a payment token that cannot be linked to its sender. This idea was also seen as controversial by some community members, which is to be expected at such an early stage.