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A penalty transaction is used to punish closing of a lightning network channel with an outdated channel state.

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2 answers
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Order of Exchanging Revocation Keys during Lightning Transactions

How do Alice and Bob share their ephemeral private keys simultaneously? If they don't, and let's say Alice first sends Bob her private key. At this point, Bob can broadcast his current commitment tran …
Tejaswi Nadahalli's user avatar