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Lightning Network

Lightning Network is a Layer 2 payment protocol that works on top of blockchain based crypto currencies using smart contracts1.

Lightning currently supports Bitcoin and Litecoin as currencies, but Bitcoin has a higher adoption.

As part of the Podcasting 2.0 initiative, monetization based on the Lightning Network was proposed.

Status

Although it is already supported by a number of hosting platforms and applications, monetization with Lightning Network is still considered experimental.

Use cases

Monetization with Lightning Network, at its current state, is used only for the value for value model.

In this model, listeners decide how much (monetary) value the listening experience has.

Users typically pledge to pay a certain amount for the time listened for each podcast, normally expressed in satoshis2 per minute.

Advantages

There are some aspects of the Lightning Network that make it attractive as a technology for podcast monetization:

  • Decentralized - Lightning payments are peer-to-peer. Although they may depend on a middle man (for routing payments), the middle man can be any participant of the network, not a central entity. This means that the podcaster cannot be "deplatformed" from a central monetization platform such as Patreon or PayPal;
  • Based on open standards - The fact that the Lightning Network is based on an open standard means that, to a certain extent3, the used software can be replaced, avoiding vendor lock-in
  • Fast - As the name suggests, Lightning payments are nearly instantaneous
  • Allows micropayments4 - Lightning payments can be done with very small amounts (i.e. down to millisatoshis for Bitcoin payments)
  • Low fees - Once the channels are setup, payments can be done with low (or event zero) fees

Disadvantages

Exchanging fiat money into crypto currencies and allocating the crypto in the Lightning Network does have considerable fees. It can also be a difficult process, depending on the setup (i.e. if the participants want to operate their own Lightning Nodes).

Specification

The specification for monetization with Lightning Network is covered in the specification for the podcast:value tag of the podcast namespace. This specification can be found here.

  1. Lightning Network - Wikipedia Article ↩

  2. 1 Satoshi = 1/100 000 000 Bitcoins, it is the smallest bitcoin unit that can be represented in the bitcoin network ledger. Reference: Bitcoin Wikipedia Article, section Units and divisibility ↩

  3. Although the lightning nodes use an open standard to participate on the network, the APIs to communicate with the nodes are not standardized and vary from node to node. ↩

  4. Micropayment - Wikipedia Article ↩