The Lightning Network aims to solve Bitcoin's problems of slow payments, high transaction costs, and poor scalability. It allows for instant, very low-cost payments between nodes by conducting transactions off-blockchain through payment channels. There are currently three main implementations of Lightning that have achieved compatibility. The network functions as a layer on top of Bitcoin through defined BOLT protocols, forming a decentralized network of payment channels between nodes.

1. The Bitcoin
Lightning Network
All About TenX Cryptopayment Technology,
Lightning Network & Bitcoin Mining
Sun Sagong 07-Feb-2018 @ TenX - Singapore

2. Problems of Bitcoin
- Payment is not instant
- Takes at least few minutes for payment to be successfully confirmed.
- Transaction cost
- You have to pay more if you want your transaction be processed.
- Scalability
- As more people use bitcoin for payment, the network become congested and slow.

3. Lightning Network (LN) aims to solve the problems
- Instant Payment
- Payments don't need block confirmations, and are instant and atomic - milliseconds to seconds.
- Micropayments
- Lightning enables one to send funds down to 0.00000001 bitcoin without custodial risk.
- Scalability
- Lightning Network transactions are conducted off the blockchain without delegation of trust and
ownership, allowing users to conduct nearly unlimited transactions between other devices.
http://lightning.network/

4. Lightning Network is on BOLT layer-2 protocol
Lightning Network is a second layer technology on top of Bitcoin network protocol.
1. BOLT #1: Base Protocol
2. BOLT #2: Peer Protocol for Channel Management
3. BOLT #3: Bitcoin Transaction and Script Formats
4. BOLT #4: Onion Routing Protocol
5. BOLT #5: Recommendations for On-chain Transaction Handling
6. BOLT #7: P2P Node and Channel Discovery
7. BOLT #8: Encrypted and Authenticated Transport
8. BOLT #9: Assigned Feature Flags
9. BOLT #10: DNS Bootstrap and Assisted Node Location
10. BOLT #11: Invoice Protocol for Lightning Payments
https://github.com/lightningnetwork/lightning-rfc

5. Three different implementations available
● ACINQ - Eclair
https://github.com/ACINQ/eclair
● Blockstream - c-lightning
https://github.com/ElementsProject/lightning
● Lightning Lab - lnd (Lightning Network Daemon)
https://github.com/lightningnetwork/lnd
Compatibility test among the three implementations was passed on 07Dec2017.
https://medium.com/@lightning_network/lightning-protocol-1-0-compatibility-achieved-f9d22b7b19c4

6. Payment Channel Network
Large Nodes
Medium Nodes
Small Nodes
Cardinality

7. Payment Example 1
Lightning NetworkOn-chain
Your Node
-200uBTC
Counter Party’s Node
+200uBTC
Your Hot Wallet Address:
1ExAmpLe0FaBiTco1NADr3sSV5tsGaMF6hd
200uBTC
Counter Party’s Hot Wallet Address:
1F1tAaz5x1HUXrCNLbtMDqcw6o5GNn4xqX

8. Payment Example 2
Lightning NetworkOn-chain
Your Node
+800uBTC
Counter Party’s Node
-800uBTC
Your Hot Wallet Address:
1ExAmpLe0FaBiTco1NADr3sSV5tsGaMF6hd
800uBTC
Counter Party’s Hot Wallet Address:
1F1tAaz5x1HUXrCNLbtMDqcw6o5GNn4xqX

9. How many Lightning Nodes are available?
Testnet - https://explorer.acinq.co/ Mainnet - https://lnmainnet.gaben.win/
1720 Nodes / 5673 Channels 561 Nodes / 1401 Channels (As of 07Feb2018)