There are a lot of advantages of running your own lightning node such as: better privacy, generating your own lightning invoices for your business, run a BTCPay server, earning few sats in fees, using your lightning address to post on platform like Y'alls(yalls.org), stacker.news, and so much more.
Step 1. First we are going to use Umbrel(https://umbrel.com/#start) to install our bitcoin full node, but to do so here is the list of everything(devices) we need:
1. Raspberry Pi 4
💡 All 2 GB, 4 GB and 8 GB RAM variants work with Umbrel. If you're
confused, pick 8 GB RAM for maximum performance.
2. Storage Drive
💡 Pick a large enough SSD (or HDD) for your use case. For eg.
if you want to run a Bitcoin node, 1 TB or more is recommended.
3. Storage Drive's Enclosure
💡 To connect the storage drive to the Raspberry Pi via USB.
16GB+ microSD
💡 The microSD card is only used for running Umbrel OS. All of your
apps and data is stored on the storage drive.
4. Power Supply
💡 Make sure to use the official Raspberry Pi power supply to
prevent any unexpected issues.
5. Ethernet Cable
💡 To connect the Raspberry Pi to your internet router.
Case
💡 Wrap your new personal server in a nice box. :)
Step 3. Download Balena Etcher. Download and install Balena Etcher on your computer. It is required to flash the Umbrel OS file that you downloaded in the previous step onto the microSD card. Download Balena Etcher: https://www.balena.io/etcher/
Step 4. Plug the microSD card in your computer. You might need a card-reader if your computer doesn’t have one.
Step 5. Flash Umbrel OS. Open Balena Etcher and flash the downloaded Umbrel OS zip file on the microSD card.
Step 6. Insert the microSD card in the Pi. After the flash is successful, remove the microSD card from your computer and insert it in the Raspberry Pi.
Step 7. Connect the SSD. Put the SSD in its enclosure, and plug it into any of the two USB 3.0 ports (blue colored) on the Raspberry Pi. 👉 Any existing data on the SSD will automatically be deleted when you turn on the Raspberry Pi.
Step 8. Connect to your router. Connect one end of the ethernet cable to the Raspberry Pi and the other
end to any vacant port on your internet router.
Step 9. Power up. Connect the power supply to the Raspberry Pi to turn it on.
Step 10. LoginAfter 5 minutes, your Umbrel will be accessible at http://umbrel.local on
any device that’s connected to the same network as the Raspberry Pi.
Assuming you successfully login to Umbrel, it will take a few weeks to fully sync your Bitcoin core node but once done you will be able to access your lightning node LND or Lightning Core by simply install the apps from Umbrel app store and start opening channels.
Conclusion, this was a quick way to plug and play your lightning node but there are many other ways one can run a node. Umbrel is one of the simplest ways but you can definitely use other interfaces like Mynode, NODL and many others or you can even build your own from scratch if you are that ambitious. there are many other ways one can run a node. Umbrel is one of the simplest ways but you can definitely use other interfaces like Mynode, NODL and many others or you can even build your own from scratch if you are that ambitious. There are many other ways one can run a node. Umbrel is one of the simplest ways but you can definitely use other interfaces like Mynode, NODL and many others or you can even build your own from scratch if you are that ambitious. I hope I did a great job laying down these strategies for you, If you have much more knowledge on how to run a node and you would love to share with us please do so in the comment section below. And also don't forget to give some Sats tip somewhere on top of the post . Thank you, Good luck on your nodeset-up!
New to Bitcoin/Crypto? As a Newbie, when I first got into Bitcoin I thought it was about outsmarting the market and getting rich quick on ''promising'' crypto projects. After properly get rekt I quickly learned my lesson and realized that this was never the way to go and that Bitcoin is the only thing that matters. Unfortunately I am not the only one who is going to get stuck with this interesting story to tell, so I am writing this article to minimize the pain for future newcomers who want to avoid these expensive mistakes and learn from them.At the end of this article I plan on revealing the most effective strategy to accumulate bitcoin. So it’s probably a good idea to read till the end.
First we are going to look at the fantastic ways you can get rekt
1. Investing in crypto projects known as altcoins
to get more Bitcoin
Bitcoin is the only time chain technology worth paying attention to out there because it is the only one
that solved the fundamental “double spend” problem, Bitcoin did that by
using proof of work, which removes the need for trust over your money
and this cannot be done twice, so anything else out there that dress like
Bitcoin or pretend to be better than Bitcoin will require trust over your
money therefore they are the same scams as the current banking system.
Furthermore, have you seen those crypto traders/ crypto influencers on
youtube? I am sure you have, and some of those people are perfect
examples of how fiat excrement looks like. I am sorry for the term
but these people are causing too much damage to newbies, I had to say it.
They will sell their innocent subscribers' souls to evil crypto exchanges that
are selling them highly leveraged trades in which they are guaranteed to
get liquidated. And these same influencers will take massive amounts of
money from crypto projects leaders to come up on their show and sell their
scams to innocent retailers who have limited knowledge on how these
scams blockchain projects work.
The bottom line is, these crypto projects will get hyped up by paid crypto
influencers and or VC funds with way more influence and money than any
small retailer who will get dumped on after buying the top. What is the
probability that you win? The probability is zero because you won’t know
when it will happen and also these things get hacked very frequently.
2. Get more yield on your bitcoin or borrow against itso you don’t have to sell.
This is another donkey thinking way to give away your keys. Bitcoin is not
a debt based system, any debt based business model built on top will
collapse fantastically and if you refuse to learn this then you are up for a
big surprise-Ask Celsians. But still, these crypto platforms will keep offering
you more yield on your bitcoin and they will never truly tell you where the
yield comes from, but I am here to tell you that you are probably the yield
they are giving away because in other for that thing to work they always
need new depositors to pay for the yield of the old depositors therefore once
the music stop the system will collapse, and you will be so glad you were out. And also, borrowing against your bitcoin is a good way to have sleepless
nights in an extremely volatile market so yeah, perfect way to get rekt.
3. Running automating trading bots
When most cryptocurrency investors first begin trading bitcoin, they typically
do so by manually placing buy/sell orders on one of the myriad bitcoin trading
platforms available. By doing this, traders are able to feel out the market,
identifying trading opportunities by looking at various trading indicators and
market metrics. However, this type of activity comes with its own risk
potentials such as: flash crashes in a black swan event, exchanges get hacked
and you lose all your funds, and also nothing says if those bots are honest bots they may be built to your disadvantage as a user.
Now, let's see how to invest in bitcoin safely to avoid getting rekt
Have you ever heard the term "Stack sats stay humble" before? That's right, Bitcoin will eventually humble you and the cure to that will be DCA. DCA means accumulate satoshis with an average amount of fiat money in a
set period of time, for example: buying bitcoin for $10 a day, or buy $100 of
bitcoin every week. This investment strategy aims to reduce the stress of
market volatility and market turbulence. There is a specific website called
dcabtc.com exclusively built to help you model things like, how much sats you
would own by purchasing $10 of bitcoin every week? Because Bitcoin is so volatile it is extremely difficult to know when bitcoin is
cheap or expensive. This is why building your Bitcoin education for more
confidence to gradually stack sats is a safer alternative and a way more
satisfactory strategy. But most importantly, while you DCA it is important to remember to take out
your coins out of exchanges otherwise you are playing with fire.
Conclusion
I understand how humans love learning from their own mistakes, but some mistakes are so expensive it worthwhile learning them from somebody else and avoid making them. Bitcoin is a hard concept to understand. It requires a lot of time and motivations but it is obtainable with the right mindset. I hope I made a good case for the best strategy which is DCA, the simplest and provably the most successful one. But you may find a strategy that works best for you, in that case you should keep using it and tell us about it in the comment section below. But no matter what strategy you are using make sure you have control over your keys.
Hyperinflation is the process through which the money you are using is becoming worthless in the blink of an eye, meaning everything you used to be able to afford such as: food, fuel, water, clothing become unaffordable in a very short amount of time. This means all the savings you have had throughout your entire life just got obliterated. Obviously this is not funny stuff, in some cases this is a matter of life and death because we can only stay alive for a short amount of time never eating or drinking, and in a hyperinflationary zone food and water are very scarce. This may sound like it can never happen in your country, your leaders have been insuring you that you will be just fine, it's a nothingburger! Giving you can see the drastic rising prices, you intuitively know that these people are running off-key and it is painful to hear these false sense of security announcements. So it make sense to have an idea how it feel like to lose it all in hyperinflation so you can prepare accordingly.
How Does It Feel To lose it all?
Well, it definitely does not feel good when you cannot feed yourself or your family in any giving day. Specially if you were unprepared or unaware of what was going on. So it make sense to educate yourself about the state of your currency or economy and learn about inflation hedges to protect yourself and your family.
If you find value in this post please take a minute to lightning tip me a few sats
I appreciate it!
Here is how much paper cash that was required to buy this much tomatoes in the Venezuela hyperinflation.
The problem is that too many people think they will have time to prepare, this will make things even tougher for the ones who are preparing now, but is the scale of which things will change. We have been living in high inflationary environment
What Is The Best Inflation Hedge?
Bitcoin is your best inflation hedge, why you ask? Because there will never be more than 21Million bitcoins in existence, this makes it the hardest money out there. There are not much of other sustainable hedges, since everything else are correlated to the same old system so when it's falling they will probably fall all together, and everything else are simply distractions and noises. Bitcoin is the most immutable ledger of truth ever existed in the history of humanity. It is permission less, censorship resistant and inflation-proof. Now, this is not to say that you should put all your money into bitcoin without even really understanding it, no you should first start learning then take very small baby steps to learn as you go.
To learn more about Bitcoin there are a lot more posts on this blog that answers a lot more questions about Bitcoin, please feel free to continue to explore more.
I am dedicating a lot of time and energy in researches to provide you all these information and knowledge.
My goal is to help as many people as I can crossing the bridge of understanding the Bitcoin saving
technology so they can protect themselves. If this post helped you in any shape or form and you would like
to support me you are welcome to contribute with as little as $0.5 to this bitcoin address below. But
most importantly please share this with your family and friends to help them out in understanding the
Bitcoin potential to save their lives.
* Stream me some sats on Fountain with my Fountain Lightning Address - theunthinkable@fountain.fm
Abstract. A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required to prevent double-spending. We propose a solution to the double-spending problem using a peer-to-peer network. The network timestamps transactions by hashing them into an ongoing chain of hash-based proof-of-work, forming a record that cannot be changed without redoing the proof-of-work. The longest chain not only serves as proof of the sequence of events witnessed, but proof that it came from the largest pool of CPU power. As long as a majority of CPU power is controlled by nodes that are not cooperating to attack the network, they’ll generate the longest chain and outpace attackers. The network itself requires minimal structure. Messages are broadcast on a best effort basis, and nodes can leave and rejoin the network at will, accepting the longest proof-of-work chain as proof of what happened while they were gone.
1. Introduction
Commerce on the Internet has come to rely almost exclusively on financial institutions serving as trusted third parties to process electronic payments. While the system works well enough for most transactions, it still suffers from the inherent weakness of the trust based model. Completely non-reversible transactions are not really possible, since financial institutions cannot avoid mediating disputes. The cost of mediation increases transaction costs, limiting the minimum practical transaction size and cutting off the possibility for small casual transactions, and there is a broader cost in the loss of ability to make non-reversible payments for non-reversible services. With the possibility of reversal, the need for trust spreads. Merchants must be wary of their customers, hassling them for more information than they would otherwise need. A certain percentage of fraud is accepted as unavoidable. These costs and payment uncertainties can be avoided in person by using physical currency, but no mechanism exists to make payments over a communications channel without a trusted party.
What is needed is an electronic payment system based on cryptographic proof instead of trust, allowing any two willing parties to transact directly with each other without the need for a trusted third party. Transactions that are computationally impractical to reverse would protect sellers from fraud, and routine escrow mechanisms could easily be implemented to protect buyers. In this paper, we propose a solution to the double-spending problem using a peer-to-peer distributed timestamp server to generate computational proof of the chronological order of transactions. The system is secure as long as honest nodes collectively control more CPU power than any cooperating group of attacker nodes.
2. Transactions
We define an electronic coin as a chain of digital signatures. Each owner transfers the coin to the next by digitally signing a hash of the previous transaction and the public key of the next owner and adding these to the end of the coin. A payee can verify the signatures to verify the chain of ownership.
The problem of course is the payee can’t verify that one of the owners did not double-spend the coin. A common solution is to introduce a trusted central authority, or mint, that checks every transaction for double spending. After each transaction, the coin must be returned to the mint to issue a new coin, and only coins issued directly from the mint are trusted not to be double-spent. The problem with this solution is that the fate of the entire money system depends on the company running the mint, with every transaction having to go through them, just like a bank.
We need a way for the payee to know that the previous owners did not sign any earlier transactions. For our purposes, the earliest transaction is the one that counts, so we don’t care about later attempts to double-spend. The only way to confirm the absence of a transaction is to be aware of all transactions. In the mint based model, the mint was aware of all transactions and decided which arrived first. To accomplish this without a trusted party, transactions must be publicly announced [1], and we need a system for participants to agree on a single history of the order in which they were received. The payee needs proof that at the time of each transaction, the majority of nodes agreed it was the first received.
3. Timestamp Server
The solution we propose begins with a timestamp server. A timestamp server works by taking a hash of a block of items to be timestamped and widely publishing the hash, such as in a newspaper or Usenet post [2-5]. The timestamp proves that the data must have existed at the time, obviously, in order to get into the hash. Each timestamp includes the previous timestamp in its hash, forming a chain, with each additional timestamp reinforcing the ones before it.
4. Proof-of-Work
To implement a distributed timestamp server on a peer-to-peer basis, we will need to use a proof-of-work system similar to Adam Back’s Hashcash [6], rather than a newspaper or Usenet posts. The proof-of-work involves scanning for a value that when hashed, such as with SHA-256, the hash begins with a number of zero bits. The average work required is exponential in the number of zero bits required and can be verified by executing a single hash.
For our timestamp network, we implement the proof-of-work by incrementing a nonce in the block until a value is found that gives the block’s hash the required zero bits. Once the CPU effort has been expended to make it satisfy the proof-of-work, the block cannot be changed without redoing the work. As later blocks are chained after it, the work to change the block would include redoing all the blocks after it.
The proof-of-work also solves the problem of determining representation in majority decision making. If the majority were based on one-IP-address-one-vote, it could be subverted by anyone able to allocate many IPs. Proof-of-work is essentially one-CPU-one-vote. The majority decision is represented by the longest chain, which has the greatest proof-of-work effort invested in it. If a majority of CPU power is controlled by honest nodes, the honest chain will grow the fastest and outpace any competing chains. To modify a past block, an attacker would have to redo the proof-of-work of the block and all blocks after it and then catch up with and surpass the work of the honest nodes. We will show later that the probability of a slower attacker catching up diminishes exponentially as subsequent blocks are added.
To compensate for increasing hardware speed and varying interest in running nodes over time, the proof-of-work difficulty is determined by a moving average targeting an average number of blocks per hour. If they’re generated too fast, the difficulty increases.
5. Network
The steps to run the network are as follows:
New transactions are broadcast to all nodes.
Each node collects new transactions into a block.
Each node works on finding a difficult proof-of-work for its block.
When a node finds a proof-of-work, it broadcasts the block to all nodes.
Nodes accept the block only if all transactions in it are valid and not already spent.
Nodes express their acceptance of the block by working on creating the next block in chain, using the harsh of the accepted block as the previous hash.
Nodes always consider the longest chain to be the correct one and will keep working on extending it. If two nodes broadcast different versions of the next block simultaneously, some nodes may receive one or the other first. In that case, they work on the first one they received, but save the other branch in case it becomes longer. The tie will be broken when the next proof-of-work is found and one branch becomes longer; the nodes that were working on the other branch will then switch to the longer one.
New transaction broadcasts do not necessarily need to reach all nodes. As long as they reach many nodes, they will get into a block before long. Block broadcasts are also tolerant of dropped messages. If a node does not receive a block, it will request it when it receives the next block and realizes it missed one.
6. Incentive
By convention, the first transaction in a block is a special transaction that starts a new coin owned by the creator of the block. This adds an incentive for nodes to support the network, and provides a way to initially distribute coins into circulation, since there is no central authority to issue them. The steady addition of a constant amount of new coins is analogous to gold miners expending resources to add gold to circulation. In our case, it is CPU time and electricity that is expended.
The incentive can also be funded with transaction fees. If the output value of a transaction is less than its input value, the difference is a transaction fee that is added to the incentive value of the block containing the transaction. Once a predetermined number of coins have entered circulation, the incentive can transition entirely to transaction fees and be completely inflation free.
The incentive may help encourage nodes to stay honest. If a greedy attacker is able to assemble more CPU power than all the honest nodes, he would have to choose between using it to defraud people by stealing back his payments, or using it to generate new coins. He ought to find it more profitable to play by the rules, such rules that favour him with more new coins than everyone else combined, than to undermine the system and the validity of his own wealth.
7. Reclaiming Disk Space
Once the latest transaction in a coin is buried under enough blocks, the spent transactions before it can be discarded to save disk space. To facilitate this without breaking the block’s hash, transactions are hashed in a Merkle Tree [7][2][5], with only the root included the block’s hash. Old blocks can then be compacted by stubbing off branches of the tree. The interior hashes do not need to be stored.
A block header with no transactions would be about 80 bytes. If we suppose blocks are generated every 10 minutes, 80 bytes * 6 * 24 * 365 = 4.2MB per year. With computer systems typically selling with 2GB of RAM as of 2008, and Moore’s Law predicting current growth of 1.2GB per year, storage should not be a problem even if the block headers must be kept in memory.
8. Simplified Payment Verification
It is possible to verify payments without running a full network node. A user only needs to keep a copy of the block headers of the longest proof-of-work chain, which he can get by querying network nodes until he’s convinced he has the longest chain, and obtain the Merkle branch linking the transaction to the block it’s timestamped in. He can’t check the transaction for himself, but by linking it to a place in the chain, he can see that a network node has accepted it, and blocks added after it further confirm the network has accepted it.
As such, the verification is reliable as long as honest nodes control the network, but is more vulnerable if the network is overpowered by an attacker. While network nodes can verify transactions for themselves, the simplified method can be fooled by an attacker’s fabricated transactions for as long as the attacker can continue to overpower the network. One strategy to protect against this would be to accept alerts from network nodes when they detect an invalid block, prompting the user’s software to download the full block and alerted transactions to confirm the inconsistency. Businesses that receive frequent payments will probably still want to run their own nodes for more independent security and quicker verification.
9. Combining and Splitting Value
Although it would be possible to handle coins individually, it would be unwieldy to make a separate transaction for every cent in a transfer. To allow value to be split and combined, transactions contain multiple inputs and outputs. Normally there will be either a single input from a larger previous transaction or multiple inputs combining smaller amounts, and at most two outputs: one for the payment, and one returning the change, if any, back to the sender.
It should be noted that fan-out, where a transaction depends on several transactions, and those transactions depend on many more, is not a problem here. There is never the need to extract a complete standalone copy of a transaction’s history.
10. Privacy
The traditional banking model achieves a level of privacy by limiting access to information to the parties involved and the trusted third party. The necessity to announce all transactions publicly precludes this method, but privacy can still be maintained by breaking the flow of information in another place: by keeping public keys anonymous. The public can see that someone is sending an amount to someone else, but without information linking the transaction to anyone. This is similar to the level of information released by stock exchanges, where the time and size of individual trades, the “tape”, is made public, but without telling who the parties were.
As an additional firewall, a new key pair should be used for each transaction to keep them from being linked to a common owner. Some linking is still unavoidable with multi-input transactions, which necessarily reveal that their inputs were owned by the same owner. The risk is that if the owner of a key is revealed, linking could reveal other transactions that belonged to the same owner.
11. Calculations
We consider the scenario of an attacker trying to generate an alternate chain faster than the honest chain. Even if this is accomplished, it does not throw the system open to arbitrary changes, such as creating value out of thin air or taking money that never belonged to the attacker. Nodes are not going to accept an invalid transaction as payment, and honest nodes will never accept a block containing them. An attacker can only try to change one of his own transactions to take back money he recently spent.
The race between the honest chain and an attacker chain can be characterized as a Binomial Random Walk. The success event is the honest chain being extended by one block, increasing its lead by +1, and the failure event is the attacker’s chain being extended by one block, reducing the gap by -1.
The probability of an attacker catching up from a given deficit is analogous to a Gambler’s Ruin problem. Suppose a gambler with unlimited credit starts at a deficit and plays potentially an infinite number of trials to try to reach breakeven. We can calculate the probability he ever reaches breakeven, or that an attacker ever catches up with the honest chain, as follows [8]:
p = probability an honest node finds the next block q = probability the attacker finds the next block qz = probability the attacker will ever catch up from z blocks behind
Given our assumption that p > q, the probability drops exponentially as the number of blocks the attacker has to catch up with increases. With the odds against him, if he doesn’t make a lucky lunge forward early on, his chances become vanishingly small as he falls further behind.
We now consider how long the recipient of a new transaction needs to wait before being sufficiently certain the sender can’t change the transaction. We assume the sender is an attacker who wants to make the recipient believe he paid him for a while, then switch it to pay back to himself after some time has passed. The receiver will be alerted when that happens, but the sender hopes it will be too late.
The receiver generates a new key pair and gives the public key to the sender shortly before signing. This prevents the sender from preparing a chain of blocks ahead of time by working on it continuously until he is lucky enough to get far enough ahead, then executing the transaction at that moment. Once the transaction is sent, the dishonest sender starts working in secret on a parallel chain containing an alternative version of his transaction.
The recipient waits until his transaction has been added to a block and z blocks have been linked after it. He doesn’t know the exact amount of progress the attacker has made, but assuming the honest blocks took the average expected time per block, the attacker’s potential progress will be a Poisson distribution with expected value:
To get the probability the attacker could still catch up now, we multiply the Poisson density for each amount of progress he could have made by the probability he could catch up from that point:
Rearranging to avoid summing the infinite tail of the distribution…
Converting to C code…
#include <math.h>
double AttackerSuccessProbability (double q, int z)
{
double p = 1.0 - q;
double lambda = z * (q / p);
double sum = 1.0;
int i, k;
for (k = 0; k <= z; k++)
{
double poisson = exp(-lambda);
for (i = 1; i <= k; i++)
poisson *= lambda / i;
sum -= poisson * (1 - pow(q / p, z - k));
}
return sum;
}
Running some results, we can see the probability drop off exponentially with z.
We have proposed a system for electronic transactions without relying on trust. We started with the usual framework of coins made from digital signatures, which provides strong control of ownership, but is incomplete without a way to prevent double-spending. To solve this, we proposed a peer-to-peer network using proof-of-work to record a public history of transactions that quickly becomes computationally impractical for an attacker to change if honest nodes control a majority of CPU power. The network is robust in its unstructured simplicity. Nodes work all at once with little coordination. They do not need to be identified, since messages are not routed to any particular place and only need to be delivered on a best effort basis. Nodes can leave and rejoin the network at will, accepting the proof-of-work chain as proof of what happened while they were gone. They cote with their CPU power, expressing their acceptance of valid blocks by working on extending them and rejecting invalid blocks by refusing to work on them. Any needed rules and incentives can be enforced with this consensus mechanism.
References
[1] W. Dai, “b-money,” http://weidai.com/bmoney.txt, 1998
[2] H. Massias, X.S. Avila, and J.-J. Quisquater, “Design of a secure timestamping service with minimal trust requirements,” In 20th Symposium on Information Theory in the Benelux, May 1999.
[3] S. Haber, W.S. Stornetta, “How to time-stamp a digital document,” In Journal of Cryptology, vol 3, no 2, pages 99-111, 1991.
[4] D. Bayer, S. Haber, W.S. Stornetta, “Improving the efficiency and reliability of digital time-stamping,” In Sequences II: Methods in Communication, Security and Computer Science, pages 329-334, 1993.
[5] S. Haber, W.S. Stornetta, “Secure names for bit-strings,” In Proceedings of the 4th ACM Conference on Computer and Communications Security, pages 28-35, April 1997.
[6] A. Back, “Hashcash – a denial of service counter-measure,” http://www.hashcash.org/papers/hashcash.pdf, 2002.
[7] R.C. Merkle, “Protocols for public key cryptosystems,” In Proc. 1980 Symposium on Security and Privacy, IEEE Computer Society, pages 122-133, April 1980.
[8] W. Feller, “An introduction to probability theory and its implications,” 1957.