They use both Ethereum and Bitcoin. In fact, they also issue USDT on Tron (TRX) now. With Bitcoin, they use the Omni Protocol to anchor transactions to the blockchain -- not sure that would work with Lightning.
ahhh, so they're actually taking the Tether coins multi-platform? I wonder which platform they'll use to roll out Tether-over-Lightning on? One would assume Omni.
@BitHodler it seems like it may not be so complicated, possibly Tether will be running in payment channels in the near future (i.e. perhaps as early as first half of next year). It depends how hard it is to get the Omni platform & protocol working in Lightning channels, but seeing as they're just colored Bitcoins running on the Bitcoin blockchain, the obstacles aren't so huge. The issue with enabling atomic swaps
directly on the Lightnning network will remain though.
this seems like a pretty good incentive for customers to use it too:
could be worse, but that's still 100 satoshis for a Lightning transaction, bear in mind that regular Lightning needs segwit addresses to work, and the cheapest segwit transaction is ~ 110 satoshis (although that's a 1 input 1 output transaction, generally impractical for a big exchange to actually do). So 10 satoshis difference isn't so fantastic a discount. They're literally throwing crumbs at you.
Also, I imagine alot of Bitfinex clients might open a direct channel with the Bitfinex node, makes sense to cut out any nodes inbetween if that's who your primary business is with. And with a direct channel, transactions can be as cheap as 0.001 satoshis (yes, that's 1/100 of 1 satoshi) per transaction, or at least that's the configured default in Lightning node software.
So although it looks cheap compared to their on-chain fees, Bitfinex are adding a huge markup to what the base costs are. And on reflection, quoting "LNX" fees is really dumb, do they have an "LNX" order book too? I feel underconfident in Bitfinex considering the way they've done this, and I understand something about it. Someone who doesn't really get the underlying concepts is gonna say to themselves "but I don't want this LNX stuff", they've pretty much ensured the continuation of the "actually an altcoin" angle.
Lightning
does use different units to on-chain Bitcoin: milli-satoshis. This LNX thing is completely made up and confusing. This makes me think Bitfinex have no clue what they're doing, and that this is going to cause problems instead of solve them.
Bring on the competition, it's not hard to compete with this offering
It's certainly low, but considering there's no fee to make LN transaction (ignoring fee to open/close channel), IMO it should be lower or free, unless they did it to cover fee for open/close channel.
right, but Bitfinex can really minimize opening fees, they can get their users to absorb most of that cost. Only if a client deposits fiat and withdraws BTC would they need to rebalance with more outgoing channels, and they'll have plenty of buffered outgoing balance slushing around as a consequence of people opening inbound channels to them anyway.
