Lightning Network Achieves Unprecedented Bitcoin Capacity
The Lightning Network, a secondary payment protocol built on top of Bitcoin, has achieved a new milestone in terms of its Bitcoin capacity.
On Saturday, the network’s capacity reached an unprecedented level of 5,630 BTC, surpassing its previous peak of 5,620 BTC on April 18. The total capacity in U.S. Dollars has also reached an all-time high, surpassing $172 million. Over the past year, the Lightning Network’s capacity has increased by 42% in Bitcoin terms and 105% in U.S. Dollar terms, indicating a growing adoption rate.
The Lightning Network functions as a network of bidirectional payment channels layered on the Bitcoin blockchain, aiming to facilitate fast and cost-effective microtransactions. By enabling users to transact directly without immediate settlement on the main blockchain, the Lightning Network offers a solution to the slower transaction speeds and higher fees associated with Bitcoin’s mainnet.
Users can establish payment channels among themselves, allowing for off-chain transactions that are later settled on the Bitcoin blockchain.
David Marcus, the CEO of Lightspark, a Lightning Network company, emphasized the significance of expanding the network’s infrastructure and capacity. Marcus stated, “By ensuring the success of larger payments on the Lightning Network, which was challenging in the past, we are constructing the foundation that will enable any enterprise to access a real-time, highly affordable settlement network for the internet.
This network will be interoperable, open, and available for any developer to build upon. I anticipate greater adoption as more exchanges become part of the network, providing efficient on and off ramps for the Lightning Network.”
Furthermore, Marcus noted that Bitcoin has experienced a surge in development activity over the past year, surpassing the progress achieved in previous years. This growth coincides with increased adoption by crypto exchanges, which have integrated the Lightning Network into their platforms.
READ MORE: Ethereum: Dormant Whale Makes Multi-Million Dollar Move, Raises Eyebrows
Binance, the largest cryptocurrency exchange globally, recently announced its integration of the Lightning Network, following the footsteps of Kraken and Bitfinex. Binance has confirmed the setup of new Lightning Network nodes on its exchange.
When evaluating the Lightning Network’s adoption, bitcoin capacity provides a more accurate indicator compared to the capacity measured in U.S. Dollars. The recent surge in U.S. Dollar capacity can be attributed to the rise in Bitcoin’s price, as it surpassed yearly highs on Friday.
Currently trading at $30,300, bitcoin has experienced an 83% increase since the beginning of 2023, according to CoinGecko data. However, it is important to note that Bitcoin’s price is still approximately 56% lower than its all-time high of $69,000 in November 2021.
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
