The Lightning Network: A failure?

[stompix]

What is the main reason most exchanges, merchants and/or businesses haven't adopted it yet?

The electric car dilemma.
You don't buy an electric car because there are no charging stations and businesses don't open charging stations because there are people buying electric cars!

Same with LN, nobody is rushing to implement it because there is no massive need for it, there was simply no progress in the number of people willing to spend crypto, I would say quite the opposite, it's less and less by day and during a bull run and an expecting price increase coming this year, there will be even less.
So why bother with something that is not used?

I wouldn't call it a failure, but more of a problem in general: good tech doesn't mean people use it, and a hype gets more exposure.

LN works, it does what it promised, the problem is that it solves things people are not really finding troubling anymore.
When you don't want to spend your coins at all and you keep them on an exchange all the time fees are like the last of your concern.

[1714521029]

1714521029

[1714521029]

1714521029

[1714521029]

1714521029

[bluebit25]

LN has not failed for the reason that it has yet to see widespread adoption of the Lightning Network. We can see that there are a lot of users holding their coins on exchanges, where simple withdrawal fees may not be too much of an issue. They prioritize speed and convenience on the network used. Cheaper alternatives like the BSC or TRX chains seem attractive in that sense. Perhaps at some point a LN boom, rising online trading fees, and a security breach on a major centralized exchange could cause people to rethink how they store their cryptocurrencies. .

[franky1]

LN has not failed for the reason that it has yet to see widespread adoption of the Lightning Network. We can see that there are a lot of users holding their coins on exchanges, where simple withdrawal fees may not be too much of an issue. They prioritize speed and convenience on the network used. Cheaper alternatives like the BSC or TRX chains seem attractive in that sense. Perhaps at some point a LN boom, rising online trading fees, and a security breach on a major centralized exchange could cause people to rethink how they store their cryptocurrencies. .

LN's problem is not about lack of users.. LN's success is not based on adoption... it has actual technical flaws and exploits and bugs..


but if you want to ignore the faults, flaws and bugs of the code.. heres something you might want to learn about just the user adoption stuff..  the more people that use LN, the more bottlenecks LN will have because routes share/borrow liquidity meaning they can only cater to soo much value per route

[pakhitheboss]

Like BRC20 which got initial hype and was trending in the same manner I guess LN hyped and now no one wants to talk about it. LN if done correctly would have helped Bitcoin in gaining adoption as of now it is not gaining any popularity. There are many issues behind it and one of the biggest I feel is the complexity of creating an LN network. The next issue I feel is the trust issue as LN has encountered vulnerability issues in the past which can be another reason. I do not think that LN would help Bitcoin gain adoption as it was proclaimed to do in the past.

[legiteum]

1. Bitcoin, and the blockchain architecture generally, was intentionally designed to be slow and expensive in order to make up for the lack of a central authority on the network.

2. Blockchain solves one unique problem: thwarting government subpoenas into transactions. That's it. It you don't want to solve that problem, it's silly to use blockchain.

3. "Centralized blockchain" is an idiotic contradiction because it's using an architecture that multiplies your complexity and cost and doesn't add any other useful features.

4. A correctly decentralized blockchain-based currency will never, by definition, scale to mainstream transaction loads.

5. Seeing this, many projects (like say Lightning) tried to do some variant of #3 in order to create the appearance of solving the scaling problem, but all that did was: a) counteract the only benefit of using the blockchain architecture; b) not really solve the problem since even "centralized blockchain" won't get you there in terms of truly mainstream transaction loads.

6. Bitcoin and cryptos generally have been very popular and useful by performing the role of meme investment instruments. People love to invest in things like this, and Bitcoin and the others fill this role. Just because blockchain isn't the magical solution to every single one of the world's technical problems doesn't mean it's a "failure".

[franky1]

3. "Centralized blockchain" is an idiotic contradiction because it's using an architecture that multiplies your complexity and cost and doesn't add any other useful features.

4. A correctly decentralized blockchain-based currency will never, by definition, scale to mainstream transaction loads.

3. blockchains either solely used within a private group/company still solves something at a cheaper cost.
namely: the lack of ability of one employee from changing records at a bank branch via access of the bank servers, as blockchains verified/archived at all bank branches prevent one employee from changing the database..
also data redundancy/backups alleviates the need for a team of IT technicians to be on shift 24/7 trying to keep one server alive and clean from attack

4. stop imagining that a cryptocurrency needs to become the dystopian world of a "one world currency" everyone needs to use all at the same time.. and even then the numbers do not need to be "millions of transactions a second" extreme that i feel you have read and recited without thinking

the whole stupidity of "all 8 billion need to only use bitcoin" and "lets destroy, abandon all fiat and all currencies" is nonsense
but if followed leads to more stupidity of "all 8 billion cant use bitcoin for all payments, so lets make a subnetwork of less security for everyone to abandon bitcoin and use a shoddy network for all 8 billion peoples uses and then middleman charge them per unsettled/unconfirmed payment" is nonsense

bitcoin doesnt need to nor have to become the dystopian "one world currency"

[DaveF]

Going by https://mempool.space/lightning and looking at capacity vs. channels we see the channel count dropping off a bit but capacity staying level in terms of BTC

But BTC vs fiat has gone up a ton.

IMO the dropping of the channel count is due to a lot of people running smaller nodes no longer bothering to connect to other smaller nodes.
I USED to have about a dozen channels open to people with limited BTC locked up and those channels never saw transactions run through them.
So I closed them.

I also know a lot of people were 'forced' to shutdown their nodes over the last 18 months or so as the BTC blockchain grew. You could no longer run a node on a 512 GB drive so you could either buy a larger drive and rebuild it or just shut it down. At a guess a while from now when the BTC blockchain + LN node databases + other needed OS stuff bump over the 1TB point we will see a bunch of people once again drop out.

According to the larger players that accept LN those numbers have remained level in terms of transactions.

-Dave

[Agbe]

The problem of Lightening Network is too cumbersome because the process of setting up the Lightening Network is not clear to most us. And I think I have seen this kind of thread before and the developers of LN were saying that the LN has failed so they will look for an alternative way for smooth and less fee transaction. And if that is done then bitcoin will not have any problem again because the main problem of bitcoin now is the congestion of it network. And I can't see Lightening Network is a fail network but they can make things easy for people to use. and the on-chain network is always over populated and that is the caused of the congestion.

[LoyceV]

the problem is that it solves things people are not really finding troubling anymore.

I'd love to make 20 times more Bitcoin transactions than I currently do, but I can't because of transaction fees. And even if I'd just pay the higher amount, that means someone else can make less transactions because blocks are full already.
At best, a merchant would use a generic payment provider that also accept LN, as part of a long list of crypto options.

The problem of Lightening Network is too cumbersome because the process of setting up the Lightening Network is not clear to most us.

That's why I like custodial LN wallets (for small amounts only). I don't have to open channels, which is easier and cheaper, and I don't have to deal with channel balancing. I'm okay trusting someone with a small amount as a trade-off.

[DaveF]

the problem is that it solves things people are not really finding troubling anymore.

I'd love to make 20 times more Bitcoin transactions than I currently do, but I can't because of transaction fees. And even if I'd just pay the higher amount, that means someone else can make less transactions because blocks are full already.
At best, a merchant would use a generic payment provider that also accept LN, as part of a long list of crypto options.

Which IMO is why we see these big LN providers keep getting bigger. YES they are for the most part custodial, but if we are talking about hot wallet amounts who cares.
Use Wallet Of Satoshi send 1 TX for whatever amount you want and get LN funds then spend LN funds wherever. And you don't have to think about it. And if once every couple of weeks you have to send them another BTC 0.002 to top up it's not a big deal.

-Dave

[franky1]

Going by https://mempool.space/lightning and looking at capacity vs. channels we see the channel count dropping off a bit but capacity staying level in terms of BTC

https://bitcoinvisuals.com/ln-channels
86k->52k

https://bitcoinvisuals.com/ln-capacity
5.4k -> 4.6k

"just a bit, stayed level" .. funny. you should book some stage time in the comedy circuit and make more jokes

Which IMO is why we see these big LN providers keep getting bigger.

the big LN custodian services are not getting bigger. its just when you remove the independent self custody users. all thats left is the LN custodian services so their PERCENTAGE of total LN liquidity increases. even if the AMOUNT of LN liquidity decreases
its basically centralisation

[legiteum]

3. "Centralized blockchain" is an idiotic contradiction because it's using an architecture that multiplies your complexity and cost and doesn't add any other useful features.

4. A correctly decentralized blockchain-based currency will never, by definition, scale to mainstream transaction loads.

3. blockchains either solely used within a private group/company still solves something at a cheaper cost.
namely: the lack of ability of one employee from changing records at a bank branch via access of the bank servers, as blockchains verified/archived at all bank branches prevent one employee from changing the database..also data redundancy/backups alleviates the need for a team of IT technicians to be on shift 24/7 trying to keep one server alive and clean from attack

Blockchain doesn't solve anything with respect to security since you still have a data store that needs to be protected just like any other data store. A hard drive is a hard drive, and hacking into it means you have control of the data on it. Application controls are application controls, and if you manipulate the controls that means you compromise the application. Adding "blockchain" to this just increases system complexity, which makes it less secure than a standard system like they've been doing for decades.

Unless the data stores are compromised, then "one employee cannot change records at a bank branch" etc. in normal banking software for instance. If they are compromised, then they can. Adding the complexity of blockchain doesn't change that one way or another.

To put it another way, if a hacker were to somehow take control over a majority of Bitcoin's servers and manipulate the ledger for their own purposes, the concept of "blockchain" would not magically protect current Bitcoin holders from such an attack: Bitcoin would be compromised and potentially anybody could lose their blocks. Of course this is extremely unlikely for a lot of reasons e.g. Bitcoin's operation on thousands of servers, and the extensive vetting that the specific software system of Bitcoin has undergone.

But there are literally thousands of examples of compromised blockchain projects out there that underscore that there's no magic buzzword you can add to something to make it secure.

4. stop imagining that a cryptocurrency needs to become the dystopian world of a "one world currency" everyone needs to use all at the same time.. and even then the numbers do not need to be "millions of transactions a second" extreme that i feel you have read and recited without thinking
the whole stupidity of "all 8 billion need to only use bitcoin" and "lets destroy, abandon all fiat and all currencies" is nonsense
but if followed leads to more stupidity of "all 8 billion cant use bitcoin for all payments, so lets make a subnetwork of less security for everyone to abandon bitcoin and use a shoddy network for all 8 billion peoples uses and then middleman charge them per unsettled/unconfirmed payment" is nonsense

bitcoin doesnt need to nor have to become the dystopian "one world currency"

I'm right there with you on this, but we keep hearing this stuff here and elsewhere like a broken record...

[DaveF]

Going by https://mempool.space/lightning and looking at capacity vs. channels we see the channel count dropping off a bit but capacity staying level in terms of BTC

https://bitcoinvisuals.com/ln-channels
86k->52k

https://bitcoinvisuals.com/ln-capacity
5.4k -> 4.6k

"just a bit, stayed level" .. funny. you should book some stage time in the comedy circuit and make more jokes

Which IMO is why we see these big LN providers keep getting bigger.

the big LN custodian services are not getting bigger. its just when you remove the independent self custody users. all thats left is the LN custodian services so their PERCENTAGE of total LN liquidity increases. even if the AMOUNT of LN liquidity decreases
its basically centralisation

You don't use LN and you don't like LN and that's fine. You do you.

6 months old but: https://cryptopotato.com/bitcoin-lightning-network-growth-surges-by-1200-in-2-years/

I use bitrefill a lot, I also use other services that take lightning a lot. I have my node peered to what works for me.
The channels I have open work for what I need it to do at a fraction of the cost of sending BTC payments to all the places I use all the time.

Some people like paying cash for things. Others would rather put everything on a credit card and get the cashback and pay one bill a month. Neither one is right or wrong.

-Dave

[franky1]

Going by https://mempool.space/lightning and looking at capacity vs. channels we see the channel count dropping off a bit but capacity staying level in terms of BTC

https://bitcoinvisuals.com/ln-channels
86k->52k

https://bitcoinvisuals.com/ln-capacity
5.4k -> 4.6k

"just a bit, stayed level" .. funny. you should book some stage time in the comedy circuit and make more jokes

Which IMO is why we see these big LN providers keep getting bigger.

the big LN custodian services are not getting bigger. its just when you remove the independent self custody users. all thats left is the LN custodian services so their PERCENTAGE of total LN liquidity increases. even if the AMOUNT of LN liquidity decreases
its basically centralisation

You don't use LN and you don't like LN and that's fine. You do you.

more comedy on your part in regards to YOUR assumptions
I DO MY RESEARCH
and that does include reading the code, and using it and testing its limits and finding its flaws..

i dont personally "use" it as in treat it like a on going long term credit card to daily spend.. but i have actually used it in regards to throwing some small at risk value into it and tried lots of tactics to use lots of different software and scenarios to see how many ways i can steal my own funds from myself via creating different scenarios of channeling to myself and brutalising all the weak points.. and it didnt take me long to find many flaws

and thats why i dont like it..
its screwed up system that doesnt work as promised. those who have least issue with it are the ones that dont use it outside a small narrow function (EG direct channel to their gambling site or they trust a certain custodian 'balance renting" system).. however the exploits are out there and when services decide their CEO wants to retire to a paradise island you will suddenly see alot of "we been hacked" excuses jump out

6 months old but: https://cryptopotato.com/bitcoin-lightning-network-growth-surges-by-1200-in-2-years/

you do know that the extra "EVENTS" do not mean extra payments for actual goods/services.
the extra "events" was a period of lots of nodes testing out "rebalancing" inside the network instead of closing-reopening channels

here is the thing

you can try it for free using a pen or a spreadsheet or any doodle app

imagine A spend 10 to (you choose)
then imagine A* wanted to rebalance via the other channel/partner/route..
notice how it then UNBALANCES the other route and causes X events
then notice the other parties may want to rebalance to get back to their first state seeing as they havnt spent their own balance so dont like seeing themselves unbalanced.
then notice their attempts to rebalance causes other unbalances..
yep one A payment causes X re balance events.. (its called a snowball effect, try it)

*if you decided A wanted to pay either DEF(not just direct pay B or C) then other letters may also want to rebalance at just the action of A's single payment

[Vincom]

It's been years since the Lightning Network was launched, yet adoption has been quite slow. Most people are still transacting on-chain, despite the fact that sometimes network fees increase to undesirable levels due to the Ordinals hype. The L2 scaling solution promised to boost mainstream adoption for BTC with its ultra-low fees and blazing-fast speeds. It's still flawed, despite being established for a few years now.

What do you think? Is the LN a failure? If not, why? Should we give it more time to mature? What is the main reason most exchanges, merchants and/or businesses haven't adopted it yet?

Your input would be greatly appreciated. Thanks.

I think Lightning Network is one of Bitcoin's biggest successes. We are currently talking about the Layer-2 trend with the popularity of Arbitrum and Optimism on Ethereum, but in fact we already have Layer-2 for Bitcoin and achieved great success when Lightning Network has a speed of millions of tps. I have never used Lightning Network and I also realize its unpopularity, but that doesn't mean Lightning Network has failed, maybe it was invented too early before we really had a need for millions of tps.

Currently, El Salvador has widely adopted BTC, people can use BTC to pay for micro-payments, this would not be possible if we did not have Lightning Network. In the future, when many other countries also adopt the BTC strategy, we will see Lightning Network being used more, creating more value, eliminating the speed and transaction fee barriers that Bitcoin has been criticized for in the past decade. I really look forward to that time, when Lightning Network will really become popular!

[Rabbitqt]

It's been years since the Lightning Network was launched, yet adoption has been quite slow. Most people are still transacting on-chain, despite the fact that sometimes network fees increase to undesirable levels due to the Ordinals hype. The L2 scaling solution promised to boost mainstream adoption for BTC with its ultra-low fees and blazing-fast speeds. It's still flawed, despite being established for a few years now.

What do you think? Is the LN a failure? If not, why? Should we give it more time to mature? What is the main reason most exchanges, merchants and/or businesses haven't adopted it yet?

Your input would be greatly appreciated. Thanks.

Indeed, the Lightning Network has been regarded as unsuccessful. It was excessively hyped for numerous years, culminating in an underwhelming infrastructure.

Ultimately, Bitcoin has diverged from Satoshi's original vision, transitioning primarily into a store of value rather than a practical currency for daily transactions, rendering the Lightning Network largely redundant.

[franky1]

It's been years since the Lightning Network was launched, yet adoption has been quite slow. Most people are still transacting on-chain, despite the fact that sometimes network fees increase to undesirable levels due to the Ordinals hype. The L2 scaling solution promised to boost mainstream adoption for BTC with its ultra-low fees and blazing-fast speeds. It's still flawed, despite being established for a few years now.

What do you think? Is the LN a failure? If not, why? Should we give it more time to mature? What is the main reason most exchanges, merchants and/or businesses haven't adopted it yet?

Your input would be greatly appreciated. Thanks.

I think Lightning Network is one of Bitcoin's biggest successes. We are currently talking about the Layer-2 trend with the popularity of Arbitrum and Optimism on Ethereum, but in fact we already have Layer-2 for Bitcoin and achieved great success when Lightning Network has a speed of millions of tps. I have never used Lightning Network and I also realize its unpopularity, but that doesn't mean Lightning Network has failed, maybe it was invented too early before we really had a need for millions of tps.

Currently, El Salvador has widely adopted BTC, people can use BTC to pay for micro-payments, this would not be possible if we did not have Lightning Network. In the future, when many other countries also adopt the BTC strategy, we will see Lightning Network being used more, creating more value, eliminating the speed and transaction fee barriers that Bitcoin has been criticized for in the past decade. I really look forward to that time, when Lightning Network will really become popular!

a. seems you have not used it, seems you have read somewhere some giberish promises, but not seen the liquidity problems bottlecks, lost funds exploits that many have experienced including the LN devs themselves that are now able to admit to the bugs, flaws and exploits now their sponsorship contracts have ended

b. LN is dropping in popularity. becoming more centralised and causing more issues.

c. bitcoin is not forced to only function with LN and LN is not forced to only function with bitcoin. for you to assume bitcoin is now reliant and "would not be possible if we did not have LN" to do things.. shows how little you actually know

d. el salvador president is hoarding coins yes. but many testimonials have shown that the real citizen and business adoption of BITCOIN has not had the success certain people pretend it has in el salvador. the promotion of "success" was short lived in autumn 2021.. but dropped when LN caused issues in el salvador, and gave bad reputation to bitcoin, hiding the real villain(LN). yep the el salv president contracted an LN 'adviser' to help add functionality to 'chivo' but it ended up as a LN failed experiment not a bitcoin success. the president within months realised he got abused and changed the plan. and moved to using a CEX and has had issues trying to re-launch a second campaign of adopting bitcoin for daily use by citizens and business, all due to the LN failure


i do laugh when the inexperienced, ill-informed people promote something via faked, broken promises they read somewhere about something they dont have full knowledge of.. its like they just want to be ass-lickers and not actually want to learn anything REAL about the thing they want to ass-lick

its like asking a orphaned virgin stuck in a boys foster home that has never had a girlfriend or sister or mother, get asked to advertise tampons and bra's

when something has issues which millions have experienced and dropped using.. we should not then see childish legomen singing "everything is awesome" in some choir voice of repetition in their non reality.
what should happen is people should raise more awareness of the short-comings, not just to help out their fellow community, but also to push the devs to adjust their own thinking and try to offer something that actually benefits bitcoiners

[SquirrelJulietGarden]

Compare the ICO/NFT BS with LN: LN is here to stay, the rest is a quick money maker until the guy who created it moves on to "the next big thing".

Bitcoin is here to stay and Lightning Network is probably here to stay too even it has less years of existence than Bitcoin.

Did we already have some projects that use their slogans like "Lightning Network killer?"

I did not know any project says it but "Bitcoin killer" is a lot but after a while some time, they are dead.

Another thing: many people still don't use Bitcoin for real payments, and many "Bitcoin users" only keep their funds on an exchange. As long as they don't use their own wallet, they won't use it for payments.

Many people just speculate and hope to get rich with Bitcoin, by storing and holding it on exchanges. Some people simply trade on exchanges and they only move their bitcoins when they want to cash out or even will not move bitcoin at all but will choose altcoins or stablecoins.

They must know the risk of bitcoin storage on centralized exchanges.

Security checklist
Reminder: do not keep your money in online accounts
Bitcoin Q&A: Not your Keys, Not your Coins

[DaveF]

One application (and yes it's custodial I know) is is doing 750k LN TXs a month
https://twitter.com/walletofsatoshi/status/1711208926727885153

Breez is also doing a lot as are others.


If you don't know what you are doing running your own LN node can be difficult. And a lot of people think it's like running Core (which people still screw up) but if you take the time to learn it's really nor that bad. And, if you want to use a custodial service (bad) LN is great. The other side is, if you are treating it as a hot wallet, who cares. Like I have said many times trading security for simplicity has risks, BUT if the risk is a minimal amount of money does it matter? 1 TX and done.


I just topped up my starbucks card with a gift card that I bought with lightning. Cost me 2sats in tx fees. Left my node, wound up bitrefill. Don't care how it got there all I know is the 1st hop since I can see that in my channels. I open channels when fees are low and I don't have to worry. Off to meet people for a ride.

Which does being up the other question, why do we meet at a coffee shop before a ride, that just means we have to stop and empty our bladders sooner.....

-Dave

[franky1]

after the mistakes and failures of LN in el salvador in sept-dec 2021
and in Nigeria much more recently
we are now starting to see another attempt using LN in a large populous of lugano switzerlands as the next test case
lets see how well/dysfunctional LN performs for users of switzerland trying to use LN en-masse.. time will tell.. lets watch what happens

so far. comparing 2023 to 2024
https://planb.lugano.ch/lugano-plan-%e2%82%bf-2023-a-year-of-collaborative-milestones-and-growing-momentum/

But growth wasn’t limited to events. Over the year, Lugano’s merchant network flourished, exceeding 350 strong. Shop accepts Bitcoin, Tether, and LGVA represents a vital step towards everyday cryptocurrency adoption, making Lugano a shining example of progress.

digging into it. they accept LIGHTNING not actual bitcoin transactions
and looking deep and more recently

https://planb.lugano.ch/crypto-payments/

292, seems to be a drop of over 60 in lightning utility (LVGA stil shows ~370 merchants. so 60 switched off lightning and tether)