Clarification of lightning network example (putting funds into lightning) I'm checking How does the Lightning network work in simple terms? answer example:


  1) Putting funds into Lightning  We both send 0.5 BTC into a shared
  2-of-2 multisig address. This requires a transaction on the Bitcoin
  blockchain.  As a "balance sheet", we each create a 2-of-2 multisig
  transaction that pays out 0.5 BTC to you and 0.5 BTC to me. I sign
  one payout transaction and give it to you. If you want to put it in
  effect, you need only add your own signature and broadcast it to the
  Bitcoin network. Vice versa, you give me your copy of the payout
  transaction that you have signed and I have not yet. The "balance
  sheet" is a regular 2-of-2 multisig transaction in the Bitcoin
  network, it just isn't valid yet, because it doesn't have all
  signatures.


So in the first step you make a regular transaction from your address A to our common 2-2 address C, and I make a regular transaction from my address B to our common 2-2 address C?

I have one key of this 2-2 multisig address C and you have another?

Address C now has 1BTC.

Now from this address C I return 0.5 of its 1 BTC to your address A and sign with my key, and you return remaining 0.5 to my address B and sign with your key?
So in the first step you make a regular transaction from your address A to our common 2-2 address C, and I make a regular transaction from my address B to our common 2-2 address C?

Yes, although in the current lightning spec and implementation, only one party funds the channel. However it could certainly be both parties that fund it.

I have one key of this 2-2 multisig address C and you have another?

Yes.

Address C now has 1BTC.
Now from this address C I return 0.5 of its 1 BTC to your address A and sign with my key, and you return remaining 0.5 to my address B and sign with your key?

Two transactions are formed at this point:

one that you make and sign and send to me that gives 0.5 BTC to you and 0.5 BTC to me,

one that I make and sign and send to you that also gives 0.5 BTC to you and 0.5 BTC to me.