# LApps: Technological, Legal and Market Potentials of Blockchain Lightning Network Applications

## TL;DR

This paper explores the current state, potential applications, and legal challenges of the Lightning Network, a technology designed to enable instant blockchain transactions and facilitate new business models.

## Contribution

It provides a comprehensive analysis of Lightning Network applications, including non-monetary uses, legal issues, and innovative business opportunities like micro-trades and settlement of securities.

## Key findings

- Lightning Network enables near-instant crypto transfers.
- Potential for non-monetary applications like securities settlement.
- Legal challenges may hinder widespread adoption.

## Abstract

Following in the footsteps of pioneer Bitcoin, many altcoins as well as coloured coins have been being developed and merchandised adopting blockchain as the core enabling technology. However, since interoperability and scalability, due to high and capped (in particular cases) transaction latency are deep-rooted in the architecture of blockchain technology, they are by default inherited in any blockchain based applications. Lightning Network (LN) is one of the supporting technologies developed to eliminate this impediment of blockchain technology by facilitating instantaneous transfers of cryptos. Since the potentials of LN is still relatively unknown, this paper investigates the current states of development along with possible non-monetary usage of LN, especially in settlement coloured coins such as securities, as well as creation of new business models based on Lightning Applications (LApps) and microchannel payments as well as micro-trades. The legal challenges that may act as impediment to the adoption of LN is also discussed.

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Source: https://tomesphere.com/paper/1906.11946