@ -67,10 +67,12 @@ Blockchain:: A distributed transaction ledger, produced by a network of computer
Transaction:: A data structure that records the transfer of control over some funds (e.g. some bitcoin). The Lightning Network relies moreover on Bitcoin transactions (or those of another blockchain) to track control of funds.
Payment:: When value is exchanged on the Lightning Network we call this a payment as the term Transaction is the technical term for entries on the Bitcoin Blockchain.
Payment:: When value is exchanged on the Lightning Network we call this a "payment" as compared to a "transaction" on the Bitcoin Blockchain.
Payment Channel:: A _financial relationship_ between two nodes on the Lightning Network, typically implemented by multi-signature Bitcoin transactions that share control over bitcoin between the two Lightning nodes.
Routing vs Sending:: Unlike Bitcoin where transactions are "sent" by broadcasting them to everyone, Lightning is a routed network where payments are "routed" across one or more payment channels following a _path_ from sender to recipient.
On-Chain vs. Off-Chain:: A payment is "on-chain" if it is recorded as a transaction on the Bitcoin (or other underlying) blockchain. Payments sent via payment channels between Lightning nodes, and which are not visible in the underlying blockchain, are called "off-chain" payments.
More detailed definitions of these and many other terms can be found in the <<glossary>>. Throughout this book, we will explain what these concepts mean and how these technologies actually work.
Andreas M. Antonopoulos
4 years ago