When it comes to light wallets, compromise is often the best descriptor. While many light wallets are easily accessible and offer some degree of security, they lack the privacy and security features that full nodes benefit from.
As it stands, most Bitcoin clients strive to offer a simple user interface in order to reduce the barrier to entry for most users. Unfortunately, great usability often comes with several significant trade-offs — including reduced security — while also risking exposure of your private information if they are hacked, bought-out, or simply go rogue.
Besides this, those looking to interact with the lightning network are usually required to run a full Bitcoin node — which essentially means downloading the entire Bitcoin blockchain, which stands at ~200GB in size. This is practically unfeasible for most mobile devices.
Additionally, running a full node requires users to sync with the network, which can take several minutes — reducing the performance gains associated with using Lightning.
Small (But Powerful)
All of this may be about to change with the advent of Neutrino — an upcoming protocol developed by Lightning Labs that massively reduces the hardware burden of securing your bitcoins while opening the potential of the Lightning Network to anybody.
Neutrino implements a new system to reduce the hardware requirements of securely managing your coins by extracting only the Bitcoin transactions relevant to each individual user — massively reducing the amount of time required to sync with the latest version of the blockchain.
By allowing users to perform their own blockchain integrity checks, Neutrino removes the problem of trust that plagues most cryptocurrency wallets — the vast majority of which rely on centralized servers that sync to the blockchain.
This will allow consumer lite clients (mobile LN wallets) with no need for hardware or a full node. User experience will feel like Cash App
— Jack Mallers (@JackMallers) January 5, 2019
Wallets integrating Neutrino into their design will allow users to benefit from many of the features of running a full node without requiring them to download a 200GB Bitcoin blockchain. Instead, users will only need to download a tiny fraction of the amount using Golomb-Rice coding to compress each block down to just ~15KB each — rather than up to 4MB, as is currently standard.
Neutrino takes this a step further by only requiring that users download the blocks that contain transactions the user’s wallet participated in, while other less important blocks take up just 80 bytes of space on the device. By compressing the blocks by such a degree, this allows even relatively-dated mobile devices to observe the blockchain directly — eliminating the need to trust third parties with your financial information.
To accomplish this, full nodes will create filters that can be checked by neutrino nodes. Each filter will correspond to an individual block of the Bitcoin blockchain but are condensed to 4MB in size.
Neutrino nodes will then compare filters received during syncing with those generated by the user wallet to determine whether a new block contains transactions relevant to the user, with relevant blocks being downloaded while irrelevant blocks will be downloaded as 80 byte “stripped” versions that contain only transaction data.
Neutrino Going Forwards
Neutrino opens the doors to Lightning on a plethora of devices — potentially reducing the resource requirements for operating a lightning node on mobile nodes. Combine this with the privacy features inherent to handling transactions off-chain in the lightning network and you’ve got a recipe for both security and privacy, with few trade-offs.
In the future, it is hoped that Neutrino-enabled devices will be able to download blocks from sources outside the Bitcoin network — such as through Tor — improving the privacy and censorship resistance of the blockchain.
Additionally, the possibility of neutrino nodes directly serving filters to other neutrino nodes is an attractive prospect, as this could act to reduce costs for full node operators while improving the overall integrity of the blockchain itself.
What is your opinion on Neutrino? Is this the tool needed to bring wallet security on mobile devices? Or is there a better alternative in the works? Let us know your thoughts in the comments below!
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