Update 03_how_ln_works.asciidoc (bitcoin#367)

I don't know who Mallory is.. perhaps he is talking about Bob

Author: enorrmann

03_how_ln_works.asciidoc

@@ -144,7 +144,7 @@ If you think carefully about 2-of-2 multisignature addresses, you will realize t
 
 Alice and Bob want to create a payment channel. They each create a private/public key pair and then exchange public keys. Now, they can construct a multisignature 2-of-2 with the two public keys, forming the foundation for their payment channel.
 
-Next, Alice constructs a Bitcoin transaction sending a few mBTC to the multisignature address created from Alice's and Mallory's public keys. If Alice doesn't take any additional steps and simply broadcasts this transaction, she has to trust that Bob will provide his signature to spend from the multisignature address. Bob on the other hand has the chance to blackmail Alice by withholding his signature and denying Alice access to her funds.
+Next, Alice constructs a Bitcoin transaction sending a few mBTC to the multisignature address created from Alice's and Bob's public keys. If Alice doesn't take any additional steps and simply broadcasts this transaction, she has to trust that Bob will provide his signature to spend from the multisignature address. Bob on the other hand has the chance to blackmail Alice by withholding his signature and denying Alice access to her funds.
 
 In order to prevent this, Alice will need to create an additional transaction which spends from the multisignature address, refunding her mBTC. Alice then has Bob sign the refund transaction _before_ broadcasting her funding transaction to the Bitcoin network. This way, Alice can get a refund even if Bob disappears or fails to cooperate.