Blogs & Articles: To Help Bitcoin Flow, We’re Adding Some Liquid to the Breez SDK 🔗 7 weeks ago

The Breez SDK has been a resounding success. Preserving the ethos of our original Lightning payment app, our Lightning SDK is a flexible solution designed to scale with the network and any number of yet-to-be-imagined use cases. That’s why it has attracted a great cast of partners pursuing different goals in different markets. Change has proven to be good. Really good.

And just like the bitcoin economy and Breez are constantly expanding, it’s time for the next stage in the expansion of our SDK. To make the SDK even more versatile, to give more people even more options in how they use their bitcoin, we’re adding a Liquid implementation.

(Cue fireworks. Just please be safe.)

What’s Liquid?

Liquid is a sidechain built to interact with bitcoin and optimize its performance in new contexts. It’s one of those “last-mile technologies” we’ve been talking about lately. The basic idea is that users swap their bitcoin for L-BTC at a fixed peg, and L-BTC transactions run on the Liquid blockchain, which is overseen by a federation of 15 functionaries. It is highly interoperable with the Bitcoin mainnet and other last-mile technologies using Lightning as the common language.

Why add a Liquid implementation?

The choice between travelling by car, train, or plane depends on many factors, like cost, distance, duration, cargo, etc. No option is objectively better than the others. Each offers different benefits under different constraints. Similarly, the Greenlight and Liquid implementations of the SDK both move money in cool, but different, ways.

One major difference is that Liquid does not use payment channels, so there are no setup fees to get started, nor are LSPs required to manage nodes’ connectivity and liquidity. Further, the absence of channels means that there are no fees or delays for channel closures, minimizing friction for end users. Without channels, there aren’t any nodes either. Instead, users see a simple balance in their Liquid wallets, which they can use to send and receive payments on Lightning.

As with all Breez products, users retain custody of their own funds. However, those funds are stored as L-BTC, which has a different trust profile than bitcoin on a Greenlight node. Since the Liquid blockchain is run by a federation, it’s not strictly a permissionless, decentralized network. Train vs. plane, right?

The Liquid implementation is also candy for developers. Since there are fewer operations to worry about, there’s less to learn, less to code, and less to test. As we’ve said before, developers are our users, so their UX is always a priority.

How does the Liquid implementation actually work?

Just as submarine swaps let funds move back and forth between Lightning and the Bitcoin blockchain, they also enable Lightning to interact with Liquid. When a user makes a payment, the SDK performs a submarine swap on the L-BTC in their Liquid wallet and converts the funds into satoshis on the Lightning Network before forwarding them to the recipient. When a user receives a payment, the SDK performs a reverse submarine swap on the incoming satoshis, converting them automatically to L-BTC and depositing them in the user’s Liquid wallet.

Sending and receiving Lightning payments is great, but our Liquid implementation also supports more advanced features we all need and expect: interoperability with the Bitcoin blockchain, LNURL-Pay, LNURL-Withdraw, LNURL-Auth, and fiat on and off-ramps (coming soon). Also on the near horizon, the Liquid implementation will include multi-device and multi-app support, allowing users to interact with the same balance across multiple apps and devices.

How to get started

If you’re ready to get started or just looking for more information, go ahead and check out the documentation and drop us a line.

To Help Bitcoin Flow, We’re Adding Some Liquid to the Breez SDK was originally published in Breez Technology on Medium, where people are continuing the conversation by highlighting and responding to this story.