In the previous part of this series, we focused on using a custodial Lightning Network wallet. In this second part of the series we will focus on more advanced mobile wallets. These will be wallets that allow you to hold your own funds and not have to rely on third parties for that function. To note, the wallets that I will go over in this will have some privacy tradeoffs.
Something that didn’t come up in the previous article of this series is the concept of channels within LN. Channels are an amount of Bitcoin allocated between two nodes on LN with a base-layer Bitcoin transaction. This wasn’t something you had to think about with a custodial wallet. Going forward in this series, it will be a consideration.
The wallet that we will introduce will take care most of the channel UX for you.
We will be looking at the Breez Wallet which is a non-custodial LN wallet that has some unique features:
- It will backup your encrypted channel state to your Google Drive — This is important because if you lose your channel state then you lose access to your funds.
- It will open up a channel to your node from the Breez routing Hub or LSP(Lightning Service Provider) as they call it — Breez will open up a 1,000,000 sat channel with you so you can immediately begin receiving funds. This requires a transaction on the base-layer Bitcoin network and three confirmations to finish setting up.
- Since your transactions are going through the Breez LSP, you benefit from how connected their routing hub is.
- Has options to do NFC transactions using the “Connect to Pay” feature.
- Uses Submarine Swaps to convert Lightning Network funds into on-chain Bitcoin.
- Available on both iOS and Android.
Once you open up Breez, it will sync and then open a channel to your node:
That will take a while, so go do something else while the channel opens and once that is complete, the screen will look like this:
Before you put any funds into this wallet, it is advisable that you backup your wallet to your Google Drive:
There are three ways for you to get funds into your Breez wallet:
- Send Bitcoin to Breez via the provided bech32 Bitcoin address. You can do this by clicking “Add Funds” in the upper left menu:
- Receive Bitcoin via the Lightning Network. (If you setup your Wallet of Satoshi wallet in the previous part of this series, you might have some sats left over!) You can do this by clicking Invoice -> Create in the lower right hand corner of the app:
- Redeem a FastBitcoins.com voucher. You can use Bitrefill.com to buy a voucher using Bitcoin, altcoins, or with your Coinbase account. You can redeem the voucher by going to “Add Funds” in the upper left menu and then clicking the orange “Redeem Fastbicoins Voucher” at the bottom of the screen:
How do I spend from Breez?
- You can either spend your sats off-chain using the “Pay” function under the lower right hand corner Invoice button. You can either scan a QR code or paste an invoice.
- You can select the “Remove Funds” option from the upper left hand menu and input a Bitcoin address to send your funds to. This will use a Submarine swap to convert your offchain funds to onchain funds.
How can I use Lightning practically?
Since Foldapp has recently added their Kickbacks program, you can now earn up to 3.5% cash back on Amazon purchases or up to 20% on other vendors on their platform. This can be a real savings even for those that aren’t Bitcoiners or people already onboarded to the Lightning network. Using Breez in concert with the Cash App would allow you to save around 2.5% on Amazon purchases including the Cash App fee.
If you use the above link to the Foldapp, you can save another 20,000 sats. Disclaimer: It will also contribute 20,000 to my Foldapp account as well.
Once you have created an account, it is as simple as choosing the card you’d like to buy:
Choose the denomination desired, click on “Use Lightning” and then “Pay Now”:
The payment page will be presented, click on the QR code icon to show the QRcode, scan it with the Breez wallet to send the requested amount of sats:
You will get your gift card code shortly thereafter!
That concludes part two of the series, in the next part of the series we are going to get more advanced and check out BLW or Bitcoin Lightning Wallet for Android.
Please let me know what you thought about this part of the series and what you might want to see in future parts of this series!
Here is the rest of the articles in this series:
Part III: Graduating to better wallets