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+# 13.3: Setting Up a Channel
 
+> :information_source: **NOTE:** This is a draft in progress, so that I can get some feedback from early reviewers. It is not yet ready for learning.
+
+You're now ready to your first lightning network channel. To begin with, you'll need to understand what is and how it's created an c-lightning channel.
+
+## What is a channel
+
+In simple terms a lightning channel is a money tube that allows fast, cheap and private transfers of money without sending transactions to the blockchain. 
+More technically a channel is a 2-of-2 multisignature bitcoin onchain transaction that establishes a financial relationship between two agents without trust.
+As we seen in [§6.1:Sending a transaction to a multisig](06_1_Sending_a_Transaction_to_a_Multisig.md) chapter multisignatures are generally described as being "m of n". That means that the transaction is locked with a group of "n" keys, but only "m" of them are required to unlock the transaction.   
+
+Channels on the Lightning Network always are created between two nodes. The channel mantains a local database with bitcoin balance for both parts keeping track of how much money they each have.
+
+In this chapter we will use testnet network and will use c-lightning as primary node to show all processes related but we will use a lnd node too to create a channel with it.  If you're running our BitcoinStandup setup you could choose either of the two implementations at the time of installing.
+
+### Steps to create a channel
+
+* Fund your c-lightning wallet with some satoshis.
+* Connect to remote node as a peer.
+* Open channel.
+
+#### Fund you c-lightning wallet.
+
+The first thing you need to do is send some satoshis to your c-lightning wallet.  You can create a new address using this command an send it money.  This is done with the `lightning-cli newaddr` command. The newaddr RPC command generates a new address which can subsequently be used to fund channels managed by the c-lightning node.  This transaction is called the [funding transaction](https://github.com/lightningnetwork/lightning-rfc/blob/master/03-transactions.md#funding-transaction-output) and it needs to be confirmed before funds can be used.  You can specify the type of address wanted,  if not specified the address generated will be a bench32.
+
+```
+$ lightning-cli --network=testnet newaddr
+{
+   "address": "tb1qefule33u7ukfuzkmxpz02kwejl8j8dt5jpgtu6",
+   "bech32": "tb1qefule33u7ukfuzkmxpz02kwejl8j8dt5jpgtu6"
+}
+```       
+
+To check you local balance you should use `lightning-cli listfunds` command:
+
+```       
+lightning-cli --network=testnet listfunds
+{
+   "outputs": [],
+   "channels": []
+}
+```       
+
+Since we still do not have the confirmed transaction we do not have a balance,  after 6 confirmations we should see balance available:
+
+```       
+lightning-cli --network=testnet listfunds
+{
+   "outputs": [],
+   "channels": []
+}
+```       
+
+
+Later we send some sats to this address in this transaction [11094bb9ac29ce5af9f1e5a0e4aac2066ae132f25b72bff90fcddf64bf2feb02](https://blockstream.info/testnet/tx/11094bb9ac29ce5af9f1e5a0e4aac2066ae132f25b72bff90fcddf64bf2feb02)
+
+
+#### Connect to remote node
+
+The first thing you need to do is connect your node to a peer. This is done with the `lightning-cli connect` command. Remember that if you want more information on this command, you should type `lightning-cli help connect`. 
+
+#### Open channel
+
+
+In this example we will use two lightning nodes running c-lightning and LND implmentations.   
+
+```
+$ lightning-cli getinfo
+moKVV6XEhfrBCE3QCYq6ppT7AaMF8KsZ1B
+```