# Simulate your first Lightning transaction on the Bitcoin regtest network Part 2 (MacOS) #### πŸ“œObjective The goal of this article is to help you * confirm that we have the correct bitcoin.conf settings * spin up a Bitcoin network * Ensure we are on the regtest network * Prepare the first lightning node aka `lnd1` for some action * Spin up node * Create wallet * Get some information about the node * Generate an Address * Fund the `lnd1` wallet with some bitcoin * load up our existing local Bitcoin wallet * send some bitcoin to generated `lnd1` wallet address (to be sent to `lnd2` later on) * Check wallet balance * Prepare the second lightning node aka `lnd2` for some action #### πŸ“œ Introduction Welcome to Part 2 of our series, fellow Bitcoin/Lightning developers. I'm sure you're itching for some action... ![morty cop](https://media4.giphy.com/media/v1.Y2lkPTc5MGI3NjExaGs0czQycTVkamp0ZmlxbTF0eDYxa21rcHM0dTRnemh4NWZwenVxMSZlcD12MV9pbnRlcm5hbF9naWZfYnlfaWQmY3Q9Zw/YRiRZGlioGVLAwo86B/giphy.gif) This is the second part of a two-part series and in case you haven't already read the first part go over here [Part 1](https://hashnode.com/post/clsctrvcp00000ale7n0pfur8) so you can fully maximize this second part. #### πŸ“œ Some boring but very important stuff to get us started ![rick thinking](https://media.giphy.com/media/v1.Y2lkPTc5MGI3NjExb3I0OXlvMGVuaHRseGJmZ25xdjIzczRuazVteWZ3MGs4M3ZpNnFobiZlcD12MV9pbnRlcm5hbF9naWZfYnlfaWQmY3Q9Zw/6SPT4vjEWBPjECMXwr/giphy.gif) The Lightning Network is a second-layer protocol built on top of the `Bitcoin blockchain` and it enables faster and cheaper transactions by creating off-chain payment `channels` between `users`. These `channels` allow multiple transactions to occur without needing to be recorded on the main `Bitcoin blockchain`. Instead, only the opening and closing `transactions` of the channel are settled on the `blockchain`. The Regtest (regression test) Bitcoin network mode creates a `local private blockchain` where you can adjust the parameters to what you want. For this demonstration, we would run our lightning network on top of an active Bitcoin network running a local private blockchain (regtest) > *Quick note: throughout this article, long `output` codeblock data are truncated* **The easy part:** #### βš™οΈ Confirming our Bitcoin environment and spinning up a Bitcoin daemon ![rick inspecting](https://media.giphy.com/media/v1.Y2lkPTc5MGI3NjExYXA4aHE4dnp5MWE5bnlkN2p0Z3FtNnF0Z3J4eTJ4MjJkbjA0aDZyZSZlcD12MV9pbnRlcm5hbF9naWZfYnlfaWQmY3Q9Zw/3o85xLbmtO1CTYvwDC/giphy.gif) To confirm that our settings are correct to spin up the required Bitcoin network mode, open up the autogenerated `bitcoin.conf` located at `/Users/user/Library/Application Support/Bitcoin/bitcoin.conf` with a text editor **Command:** ```zsh nvim /Users/user/Library/Application Support/Bitcoin/bitcoin.conf ``` **Output:** ```zsh # Daemon Options server=1 daemon=1 fallbackfee=0.00072 txindex=1 mintxfee=0.0001 txconfirmtarget=6 # Network Options regtest=1 #signet=1 #testnet=1 [regtest] # RPC Options rpcport=18443 rpcuser=bitcoin rpcpassword=bitcoin # ZMQ Options zmqpubrawblock=tcp://127.0.0.1:28332 zmqpubrawtx=tcp://127.0.0.1:28333 zmqpubhashtx=tcp://127.0.0.1:28332 zmqpubhashblock=tcp://127.0.0.1:28332 ``` Now let's follow through the following steps #### πŸ“œ Spin up a Bitcoin network (regtest network) **Command:** ```zsh bitcoind ``` **Output:** ```zsh Bitcoin Core starting ``` #### πŸ“œ Ensure we are on the regtest network **Command:** ```zsh bitcoin-cli getblockchaininfo ``` **output:** ```json { "chain": "regtest", // πŸ‘ˆπŸΏ just making sure we are on the 'regtest' network "blocks": 526, "headers": 526, ... } ``` #### πŸ“œ Prepare the first lightning node aka `lnd1` for some action We'll be preparing our first lightning node now so go ahead and open up two new shell tabs or terminal windows and follow the following steps to spin up both of our previously configured lightning nodes respectively. **First Tab:** Let's go ahead and start up our first node **command:** ```zsh lnd1 ``` **output:** ```zsh 2024-02-14 02:38:18.958 [INF] LTND: Version: 0.17.0-beta commit=fn/v1.0.1-85-ge31d15989, build=production, logging=default, debuglevel=info 2024-02-14 02:38:18.958 [INF] LTND: Active chain: Bitcoin (network=regtest) 2024-02-14 02:38:18.958 [INF] RPCS: Generating TLS certificates... 2024-02-14 02:38:18.960 [INF] RPCS: Done generating TLS certificates 2024-02-14 02:38:18.961 [INF] RPCS: RPC server listening on 127.0.0.1:10009 2024-02-14 02:38:18.963 [INF] RPCS: gRPC proxy started at 127.0.0.1:8080 2024-02-14 02:38:18.963 [INF] LTND: Opening the main database, this might take a few minutes... 2024-02-14 02:38:18.963 [INF] LTND: Opening bbolt database, sync_freelist=false, auto_compact=false 2024-02-14 02:38:19.003 [INF] LTND: Creating local graph and channel state DB instances 2024-02-14 02:38:19.069 [INF] CHDB: Checking for schema update: latest_version=31, db_version=31 2024-02-14 02:38:19.069 [INF] CHDB: Checking for optional update: prune_revocation_log=false, db_version=empty 2024-02-14 02:38:19.069 [INF] LTND: Database(s) now open (time_to_open=106.471482ms)! 2024-02-14 02:38:19.069 [INF] LTND: We're not running within systemd or the service type is not 'notify' 2024-02-14 02:38:19.069 [INF] LTND: Waiting for wallet encryption password. Use `lncli create` to create a wallet, `lncli unlock` to unlock an existing wallet, or `lncli changepassword` to change the password of an existing wallet and unlock it. ``` **Second Tab:** Now let's create a wallet, run the command below and follow through the wallet creation prompts **command:** ```zsh lncli1 create ``` **output:** ```zsh Input wallet password: Confirm password: Do you have an existing cipher seed mnemonic or extended master root key you want to use? Enter 'y' to use an existing cipher seed mnemonic, 'x' to use an extended master root key or 'n' to create a new seed (Enter y/x/n): n Your cipher seed can optionally be encrypted. Input your passphrase if you wish to encrypt it (or press enter to proceed without a cipher seed passphrase): Generating fresh cipher seed... !!!YOU MUST WRITE DOWN THIS SEED TO BE ABLE TO RESTORE THE WALLET!!! ---------------BEGIN LND CIPHER SEED--------------- 1. absorb 2. mammal 3. thank 4. isolate 5. depart 6. trigger 7. legal 8. unhappy 9. purchase 10. strong 11. effort 12. kangaroo 13. entry 14. solve 15. flower 16. mule 17. buyer 18. today 19. cancel 20. material 21. pupil 22. napkin 23. employ 24. ill ---------------END LND CIPHER SEED----------------- !!!YOU MUST WRITE DOWN THIS SEED TO BE ABLE TO RESTORE THE WALLET!!! lnd successfully initialized! ``` Let's go ahead and fetch some basic information about our node. Run the command below **command:** ```zsh lncli1 getinfo ``` **output:** ```json { "version": "0.17.0-beta commit=fn/v1.0.1-85-ge31d15989", "commit_hash": "e31d1598932a814c2d44b774e5110746295df711", "identity_pubkey": "02e0810d836946eebaeb9186c45ebb0c2d17294890ec67f488c9127de4d51dd3cd", "alias": "02e0810d836946eebaeb", "color": "#3399ff", "num_pending_channels": 0, "num_active_channels": 0, "num_inactive_channels": 0, "num_peers": 0, //πŸ‘ˆπŸΏ take note of this number (our node is a bit lonely for now) "block_height": 547, "block_hash": "10f9fb091fd2b83736ffde6621100d6db40b09fad3676c7930dce1821c31066a", "best_header_timestamp": "1707215728", "synced_to_chain": false, "synced_to_graph": false, "testnet": false, "chains": [ { "chain": "bitcoin", "network": "regtest" } ], .... } ``` Time to create an address that would receive the bitcoin sent to the lightning node wallet **command:** ```zsh lncli1 newaddress np2wkh ``` **output:** ```json { "address": "2N5qZ8TNWbrkaYxmsLYjEd8g6U7CrjDfHky" } ``` Let's load up our Bitcoin wallet from the previous tutorial, send some juicy `100` Bitcoin from it to our lightning address above and then generate some blocks to give it some confirmations ![dancing](https://media.giphy.com/media/v1.Y2lkPTc5MGI3NjExbWt6anVjdXY4amFsa2M0emx1cjQ0dGNscDdpMnViZ2FnMnAwb2tuaSZlcD12MV9pbnRlcm5hbF9naWZfYnlfaWQmY3Q9Zw/JTa7LMZnXcrF0oyMxo/giphy.gif) *"my oh my!!, what a man could do with some real `100` btc just sitting in a wallet 🀀. Alight alright that's enough buddy, don't be weird let's get back to the article."* Run the commands below in sequence **command 1:** ```zsh bitcoin-cli loadwallet my_first_regtest_wallet ``` **output:** ```json { "name": "my_first_regtest_wallet" } ``` **command 2:** ```zsh bitcoin-cli sendtoaddress 2N5qZ8TNWbrkaYxmsLYjEd8g6U7CrjDfHky 100 ``` **output:** ```zsh 3d36c8fc08f3ffd82bfa4e2aa33a63bf6c254bb46ffa1309fb9c7eb99adb3848 ``` **command 3:** ```zsh bitcoin-cli generatetoaddress 10 "mhF5zQHNn7wzaaQTpzRmtsNgPgFF94fxeY" ``` **output:** ```json [ "2fb9db66a292f9f37260be1490833d7cb4b1d5442478be67fd3d7c48281271c5", "7f284d403862117a21461da7cfdc3437a870fd608d0afe5e672c5c378ea2bc73", "4b4e867a02e49145f71b662fa4fea2a30eeff0d9a689953b655222ef2e336bd4", ... ] ``` Let's go ahead and check our `lnd1` wallet balance **command:** ```zsh lncli1 walletbalance ``` **output:** ```json { "total_balance": "10000000000", //πŸ‘ˆπŸΏ sweet, our wallet was credited successfully "confirmed_balance": "10000000000", "unconfirmed_balance": "0", "locked_balance": "0", "reserved_balance_anchor_chan": "0", "account_balance": { "default": { "confirmed_balance": "10000000000", "unconfirmed_balance": "0" } } } ``` #### πŸ“œ Prepare the second lightning node aka `lnd2` for some action To get the second lnd node configured and running, repeat all the steps we followed above but this time around, funding the `lnd2` wallet with some bitcoin is optional as this node would be on the receiving end of our transaction. #### πŸ“œ Conclusion We'll conclude here. Thank you for staying with us until the end of the second part. In the final part, we'll walk through connecting peers, opening payment channels, and other processes necessary for a valid lightning transaction. #### πŸ“œ Useful links * [part 1 of the series](https://hashnode.com/post/clsctrvcp00000ale7n0pfur8)