Setting wallet limits sends excess funds to cold storage, Alex Bosworth notes

Setting wallet limits sends excess funds to cold storage, Alex Bosworth notes
Lightning Loop wallet limit reduces exposure

Alex Bosworth, Alex Bosworth of Lightning Labs, described a method for managing risk with Lightning Loop. He said setting a limit on a hot wallet for a Lightning node and automatically sending any excess funds to cold storage can help ensure that the maximum potential loss remains capped at the chosen limit. Bosworth advised that exchanges or merchants who receive funds over the Lightning Network consider using this approach or a similar method.

Bosworth has previously addressed risks related to digital asset management. He noted that while BTC hacks may be getting easier, advances in tracing technology could make it simpler to catch thieves. In a separate project, Bosworth discussed providing cold storage guidance for everyday BTC users.

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