Lightning Network: Isn't there a risk in spending more BTC than needed?

Question

Say, I want to establish a payment channel with an individual, Jim. I want to make 10 monthly payments of 0.01BTC to him for a total of 0.1BTC. I don't want to spend 0.1BTC at once, but in order to create a payment channel with 0.1BTC capacity, I have to send a 0.1BTC transaction to Jim to create the Payment and hope he doesn't close the channel. If he does, then the 0.1BTC is sent to the main blockchain?

If all I have is 0.01BTC to start with, all I an send to Jim is 0.01BTC once. The only way I can send more is if there are already other funded payment channels between myself, Jim, and another node that have remaining capacity?

Answer 1

I have to send a 0.1BTC transaction to Jim to create the Payment and hope he doesn't close the channel. If he does, then the 0.1BTC is sent to the main blockchain?

Opening a channel doesn't involve "sending coins to Jim", it involves "opening a channel with Jim". You do not need to trust Jim to not steal your funds, because of the threat of revocation if he misbehaves and attempts to publish an old channel state. If Jim closes the channel honestly, he will be paid out according to the current channel balance. The 0.1 BTC locked into that channel will be split according to the current state of the channel, with Jim's share going to Jim, and your share being returned to you.

If all I have is 0.01BTC to start with, all I an send to Jim is 0.01BTC once. The only way I can send more is if there are already other funded payment channels between myself, Jim, and another node that have remaining capacity?

Yes, there is no such thing as debt on the Bitcoin or Lightning Network. In order to pay someone, you need the available funds or channel capacity. This capacity can come by routing a payment to Jim, using some other node(s) you are both connected to.