LNHANCE bips and implementation

The proposed mechanism aims to optimize the use of blockchain space by incorporating the funds required for onchain fees in case of unilateral exits directly within the mechanism itself. This approach eliminates the need for maintaining an additional Unspent Transaction Output (UTXO) on the blockchain specifically for covering these fees, which is the current standard practice involving anchor outputs and Child Pays For Parent (CPFP) transactions.

By integrating the fee within the mechanism, it streamlines the process and reduces the blockspace required. However, this convenience comes with a trade-off: it necessitates the reservation of funds for potential onchain fees within each mechanism. To facilitate this, there is a suggested extension to OP_CHECKTEMPLATEVERIFY that is under consideration. The details of this proposal can be explored further through the provided link.

This design approach presents a balance between efficiency in terms of blockspace utilization and the requirement to lock up additional funds to ensure the availability of fees for unilateral exits. It is an innovative concept that could potentially streamline certain operations on the blockchain if implemented.