Let's do an important recap about Lightning Key concepts

I felt the need to recap the basis of the Lightning Network, because sometimes we go a lot deep on it while forgetting to point out the basic concepts which are milestones for understanding how the magic takes place.

We know that the Lightning Network is a second-layer protocol built on top of the Bitcoin blockchain. This was designed to enable fast and cheap offchain transactions for making possible day-to-day Bitcoin spending.

The initial idea for the Lightning Network was proposed in 2015, and the first implementation was launched in 2018. We can say it’s something built on top of Bitcoin base layer, a kind of protocol built on top of the Bitcoin base layer protocol.

The Lightning Network is a routed network of payment channels. A payment channel is a financial relationship between two nodes on the Lightning Network, typically established by funding a 2-of-2 multisignature Bitcoin address.

Once a channel is open, the two parties can exchange multiple off-chain payments by updating the balances within the channel without needing to record each transaction on the Bitcoin blockchain and this makes the magic. These off-chain payments are instant and have low fees.

For users who do not have a direct payment channel, the Lightning Network can route payments through a series of interconnected channels. This process needs finding a path from the sender to the recipient across the network.

...read more at massmux.org