Ethereums Raiden Network and how does it work

The Raiden network will bring the Ethereum platform to superior levels

The Bitcoin Lightninging Network is one of the most known microtransaction second layer solutions that is currently being used and growing in the cryptocurrency industry. However, most people have not yet realized the potential of the Ethereum Lightning Network which is also seen as an answer to the Bitcoin Lightning Network.

The Ethereum version of the Lightning Network is called the Raiden Network which is an off-chain ERC-20 compliant token scaling solution for the transfer of tokens on the Ethereum Blockchain.

Ethereum Raiden Network

The benefits of the Ethereum Raiden Network is similar to the Bitcoin Lightning Network, which includes scalability, low-fees, instant and private payments solutions. This has bothered some developers on how the Raiden Network is able to achieve this, which brings us to focus our attention on the mechanisms that builds up this network in order to achieve true transmission of messages across the Raiden Network.

The Raiden Network aims to facilitate the seamless transfer of tokens throughout the Distributed Ledger Technology (DLT) which can be seen as a semi-decentralized Blockchain. The Raiden Network is heavily depends on the timely exchange of messages between any participating nodes on the network.

The messages that can be transmitted across the Network

All messages that are transferred across the network nodes follow some fixed protocols and characteristics, like the information that is contained within a specific token. This can range from messages that consist of details of the recipient, the network that underpins the token and is being used, the number of tokens being transmitted and as well as the smart contract that is used on the Blockchain platform.


All messages that are being transmitted are signed in order to authenticate the balances on the underlying Blockchain network. For instance, if a message is to be sent from node A to node D on the Raiden Network, the message will also have to be verified by node B and C in order to ensure correct authentication of that transaction on the Blockchain network.

ethereum raider network

The areas that are most critically focused on in the Raiden Network include four major features like scalability, speed, Decentralization setup and accessibility.

The focus on Privacy vs Efficiency and the Matrix Protocol on the Raiden Network

The ever-growing Raiden Network community as it stands today is low on the choices that can be made on this second layer solution, as there is a trade-off between efficiency (scalability) of the network and privacy (anonymity) of the Network.

The argument behind the scalability and privacy issues can be addressed by looking at the passive protocols that are provided. The passive protocols are typically in a high degree of privacy when encrypted messages are broadcasted to the nodes on the network, without any explicit statement of who the receiver or recipients are. After one node receives a message, every other node on the network starts trying to decrypt that broadcasted message using its respective private keys. But only the intended recipient of that message will be able to decrypt it with the private key. This gives the Raiden Network a high level of privacy and anonymity when considering the transfer of messages across the network, this, however, makes it falter on equal grounds with scalability and at times with network latency.


The Raiden Network still faces some challenges like the community switching from its User Data Protocol(UDP) to the Matrix protocol with the testnet v0.4.0 Icalo that was released. According to the website:

“The Matrix protocol is an open standard for interoperable, decentralized, real-time communication over IP. It can be used to power instant Messaging, VolP/WebRTC signaling, internet of things communication or anywhere you need a standard HTTP API for publishing and subscribing to data whilst tracking the conversation history.” 

The Raiden Network uses the Matrix properties as it is one of the layers that the Bitcoin Lightning Network also uses for superior transaction methods. However together with the former UDP, the Raiden Network becomes stronger over time based on the following:

  • The enhancement of the reliability of the network, the UDP recently went through a hotfix that has brought the degree of security to unparalleled levels in the Matrix protocol. The issues that are concerning the messages or retransmission is almost negligible.
  • The Matrix Network has no NAT traversal issues, which means that communication is always initiated from the client back to the servers. This makes it hard for any issues to occur running into any NAT traversal issues.
  • The Matrix protocol is set-up based on decentralization configurations, this will happen if there are insufficient participating home servers on the network.
  • The Raiden Network also comes with a Message log, this feature is not currently being used however this can aid the community in the future to allow for offline messaging as well as other required customizations.

The Matrix protocol additionally provides continuous out-of-the-box support for end-to-end encryption of data. As Matrix is an open-source project it allows for greater participation from the community.

matrix network on ethereum


The Matrix security protocol is unparalleled and is one of the primary concerns of the burgeoning digital economy. The security risks are mitigated by the communication between the Matrix servers and the Raiden nodes that are shielded via a Transport Layer Security (TLS for short).

All chats that are done on the Matrix Network is private, and its content can only be viewed by the users that are invited to those particular rooms. The server operators cannot access the chat rooms that they are not invited to which means the security protocol is applicable to everyone. Besides that, any malicious server attacks can be mitigated with the help of OLM protocol, which ensures end-to-end encryption of message data.

The community is currently waiting on further developments or the emergence of transport protocols that can be addressed by any obstacles of scalability and fix the latency issues that the Raiden Network is currently facing. This has to be engaging with the privacy parts of the Matrix protocol as well, the Matrix protocol is set become one of the preferred choices for P2P transportation of transactions on the Ethereum Blockchain.


My occupation is the Research of blockchains and their practical applications in the economy. I have graduated through various levels of education, including electrical technique, Business, Psychology, and innovative technologies.

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