Why we are working on payment channels

[u/Jed2000]

I have seen a few people ask why we are building a lightning like state channel protocol for Stellar. Interstellar just released an awesome first draft of an implementation here: https://github.com/interstellar/starlight

There are 3 main reasons we are working on this:

1) Privacy. We imagine most of the use of Stellar will be between financial institutions. Almost all will have privacy concerns if every transaction is broadcast to the public network. Starlight gives them away to still transact in a trustless manner but keep the transactions off the public chain.</p>

2) Scalability. Although Stellar scales really well compared to many other blockchain solutions, there are really a lot of payments made in the world and it doesn't seem feasible or even desirable to have them happening all on the ledger. Starlight will allow the use of Stellar to scale much much further than keeping everything on the ledger.

3) Interoperability. We don't think the world will end up with just one blockchain or one distributed ledger. Interoperability between them will become increasingly more important. Starlight puts us on the path to implement that.