So far, we are working on the [https://github.com/rustyrussell/lightning/blob/master/communications/low/01-encryption.md](inter-node encryption) and [https://github.com/rustyrussell/lightning/blob/master/communications/low/02-wire-protocol.md](transaction negotiation) phases.
file). There are command line utilities to create and process various
packets in [test-cli](test-cli/HOWTO-USE.md).
The second step is to create a daemon which uses that protocol to
communicate with others to set up channels and make simple payments.
This also involves monitoring the blockchain for transactions. This
is where development is currently occurring.
Later steps will enhance the protocol to network individual daemons,
Later steps will enhance the protocol to network individual daemons,
advertize their IP addresses, publish routes and fees, and use that
advertise their IP addresses, publish routes and fees, and use that
information to pay specific nodes. These details are currently being
information to pay specific nodes. These details are currently being
hashed out on the [mailing list](https://lists.linuxfoundation.org/mailman/listinfo/lightning-dev) and the IRC channel [#lightning-dev](https://botbot.me/freenode/lightning-dev/) on Freenode.
hashed out on the [mailing list](https://lists.linuxfoundation.org/mailman/listinfo/lightning-dev) and the IRC channel [#lightning-dev](https://botbot.me/freenode/lightning-dev/) on Freenode.
The protocol requires features not currently in bitcoin, so by default
The protocol requires features not currently in bitcoin, but can be tested
it runs on top of the sidechain [Elements
with bitcoin (on testnet) with OP_NOP substitution.
Alpha](https://github.com/ElementsProject/elements). It can be tested
with bitcoin (on testnet) with OP_NOP substitution, at the top level
Makefile.
Final note: This is very much a testbed and work in progress; expect
Final note: This is very much a testbed and work in progress; expect