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Thor: a service that allows you to buy payment channels at low cost

Thor tutorial canales pago
Thor tutorial canales pago

Thor is a service that offers the ability to purchase secure payment channels connected to the Bitrefill node, Allowing you to send and receive payments through the Lightning Network.

First, let’s put ourselves in context: A payment channel is the means by which we can receive and send cryptocurrencies, through the Lightning network, Something akin to a traditional digital currency portfolio, though not quite the same.

For this payment channel to work you need two things, a node that allows you to connect to the network which is where the exchanged cryptocurrencies were originally found And also balance in the digital currency to use, which will serve to set the capacity of the payment channel, which is the total number of cryptocurrencies that it can store.

Regarding this last point; in order to set the limit of a payment channel, the bitcoin equivalent of the selected capacity must be blocked, resulting in a payment channel, but with the particularity that it will be full, ie it would be like transferring part of our balance in BTC to the Lightning network payment channel. However, once it is closed, the funds that are still in it will be sent to our Bitcoin wallet.

Therefore, for this case which is the original way a payment channel is created there are two limitations: The first is that if we want a 16,000,000 capacity satoshis payment channel, we have to count on that amount. In second place is the fact that, when creating a payment channel in this way, these are generated to the limit of their capacity, causing that, to receive, it must be sent, in order of emptying the canal a little. And this is where the advantage of using Thor lies.

First, we need Thor to sell us literally empty payment channels that we can manage from our wallet, making sure that once the payment is made, we have it operational, ready to receive.

Before we get started, it’s important to note that, according to some Reddit users, this service is centralized. This would imply that it uses a custodian node to function, so that every Satoshi we handle within the payment channel will be stored and managed by Thor’s own node.

To get started, you need to have the Lightning Wallet installed and configured, a wallet that allows you to manage Thor payment channels and is currently only available for Android. This causes Bitrefill payment channels to currently only be they can manage through this portfolio or by means of the LND (command line of Lightning Network).

Buy payment channels in Thor

Before synchronizing the payment channel with Lightning Wallet, we need to buy one. So we’ll start by going to Thor’s portal.

Source: Bitrefill.

From there we will start the buying process. On the right are the forms of payment in digital currency that we will have available, among which the option to pay through the Lightning network stands out.

To start the process, we will click on the digital currency with which we want to pay.

Source: Bitrefill.

The first step is to choose the capacity or channel size, this would be the total in BTC expressed in satoshis which you can store, as I mentioned at the beginning. Along with each size we will see the price in BTC of each payment channel depending on the capacity

Before we continue, we must keep in mind that due to the limitations of the Lightning network, Bitrefill will keep our channel open for only 30 days in case of no motion detection. This must be taken into account when choosing your capacity. Funds that are stored after 30 days of inactivity, will be refunded in full.

Once we have the chosen capacity, we will have to add an email from where Bitrefill will be able to communicate, either due to problems with the channel or due to a refund of funds.

Source: Bitrefill.

Now it’s time to pay for the channel. That is why we will have different options, such as those seen in the image above. Here we can highlight that, in addition to paying with digital currency or with the balance of our Bitrefill account, we can also pay through the Lightning network with either litecoin or bitcoin.

In my case, I chose to pay through BTC’s Lightning network through a payment channel I had previously opened, but remember that you can choose any other. This is in order to demonstrate the speed and benefits we get from using this payment method, as when paying the payment is confirmed immediately without waiting for confirmations from the blockchain.

Source: Bitrefill.

This is the address of the payment invoice, which reminds us that we are paying through the Lightning network. If you choose any other method, only the direction from which the funds will be sent will vary.

We just have to scan and pay the specific amount shown on screen.

Source: Bitrefill.

With this we already own a payment channel. The next step is to sync with our Lightning Wallet, assuming we already have it installed.

Sync payment channel with Lightning Wallet

The first step to start syncing will be to select the option Open your new lightning channel with redemption instructions provided (Open your new channel with the exchange instructions provided).

Source: Bitrefill.

What we see in this image is the data concerning our channel. Now we have to go to our Lightning Wallet and on the main screen scroll left to open the camera and scan the QR code.

channel-confirmed-ready
Source: Bitcoin Lightning Wallet.

When scanning, we will see a box indicating that the payment channel is being created. Once we have paid in Bitrefill, we will have to wait at least 3 confirmations within the bitcoin network for the channel to be fully operational.

After receiving the 3 confirmations, the channel will be operational to send and receive payments. The management of this channel will be the same for channels created directly in Lightning Wallet.

conclusion

The Thor service has two key advantages. First, we can create a payment channel very quickly, as long as we use immediate payment methods, such as Coinbase, Localbitcoin, or through the Lightning network. Second, for a small payment we can have a payment channel with a large capacity. In the traditional way this would not be possible, as we would have to block part of our BTC to give the channel capacity.

As it is a very simple service, as its only function is to allow you to buy payment channels from the Lightning network, I do not see any weaknesses in its operation. I just have to stress that when it comes to choosing channel capacity, it is pre-established, an issue that could go against our needs.

You can watch this and more video tutorials on our YouTube channel.

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