News - Here's how much the Bitcoin Lightning Network has grown

By Mike Hesp

Here's how much the Bitcoin Lightning Network has grown

Bitcoin (BTC)
Blockchain-Technology

Bitcoin financial services provider River publishes figures on the Lightning Network. Even in a declining market, the second-tier network is showing robust growth.

Lightning is seen by Bitcoiners as the answer to the problems of scaling the Bitcoin network. The principle is quickly explained: instead of posting every transaction on-chain, the network relies on so-called offchain payment channels and sends the balance of two channels to the blockchain only after some time. The network is basically considered efficient.

But what about network usage? There are now new figures on that, gathered by the financial services provider River.

In August of this year alone, it processed Lightning network more than 6.5 million transactions. By comparison, two years earlier there were 503,000 - an increase of 1,212 percent.

Growth of the Lightning network in a nutshell.

Source: River

Nevertheless, users are still sending more BTC from A to B on the Bitcoin main layer. In the report, River writes:

On average, Lightning processes at least 47 percent of Bitcoin transactions on the Bitcoin Blockchain every day. On a monthly basis, this equates to 14 days of Bitcoin transactions on the blockchain.

On average, the volume amounts to 2.5 transactions per second on Lightning and 4.4 transactions per second on-chain. According to River, one of the main reasons for the on-chain overhang is the lack of payment network integration on exchanges. Currently, only a handful of BTC support exchanges het second-layer netwerk.

Transaction volume increases steadily

Estimated growth in transaction volume.

Source: River

Logical: As use of the scaling network increases, so do the volumes transferred. In August 2023, users sent a total of 2,950 BTC via Lightning. This corresponds to a transaction volume of $78.18 million - an increase of 874 percent measured in BTC.

Lightning: Microtransactions dominate

Especially popular for microtransactions: The Lightning Network

Source: River

As the graph above shows, Lightning is primarily used for microtransactions in the one- to three-digit Satoshi range. So the use case seems to be working. After all, the second-layer network was supposed to solve the problem of cumbersome and expensive transactions. On average, users sent about 44,700 sats per transaction in August 2023, worth US$11.84.

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