The Lightning Network: A failure?

[franky1]

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.

2 sats in LN fee
the idea/promise/promotion of msats being multiple 0's below 1sat to allow fees to be many times below 1sat seems to be dying out too as a promise/proposition, if you are paying more then 1whole sat

guess the LN promise of sub-sat(msat) fee's already broke.. seems even LN is starting to hike up their fee's

(and before claiming anything. LN only functions over a 20hop gossip path, meaning the max length to destination could be 20 hops. meaning minimum fee per hop if full path was used would be 0.1sat, even though msat allows for far more subsat pegging)

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[Cryptomultiplier]

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)

You have given enough data and passed alot of information on the LN and am sure before it was adopted as the network for Lugano who just accepted BTC and cryptocurrencies for use in the Swiss, they must have trusted the network to perform better. There was a memorandum of understanding signed between Lugano and El Salvador before this launch was effected by Lugano and am sure the right test and set up has been ensured to make sure the lightening network works better and delivers beyond expectation seeing it will serve more users and devices simultaneously.

[DaveF]

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.

2 sats in LN fee
the idea/promise/promotion of msats being multiple 0's below 1sat to allow fees to be many times below 1sat seems to be dying out too as a promise/proposition, if you are paying more then 1whole sat

guess the LN promise of sub-sat(msat) fee's already broke.. seems even LN is starting to hike up their fee's

(and before claiming anything. LN only functions over a 20hop gossip path, meaning the max length to destination could be 20 hops. meaning minimum fee per hop if full path was used would be 0.1sat, even though msat allows for far more subsat pegging)

Nah, the reason most places charge 1 sat to route through their node is that it's the default.
Some charge less.
Some charge more.
Some don't charge.
But most people running their own nodes just kept the default.

-Dave

[franky1]

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.

2 sats in LN fee
the idea/promise/promotion of msats being multiple 0's below 1sat to allow fees to be many times below 1sat seems to be dying out too as a promise/proposition, if you are paying more then 1whole sat

guess the LN promise of sub-sat(msat) fee's already broke.. seems even LN is starting to hike up their fee's

(and before claiming anything. LN only functions over a 20hop gossip path, meaning the max length to destination could be 20 hops. meaning minimum fee per hop if full path was used would be 0.1sat, even though msat allows for far more subsat pegging)

Nah, the reason most places charge 1 sat to route through their node is that it's the default.
Some charge less.
Some charge more.
Some don't charge.
But most people running their own nodes just kept the default.

-Dave

exactly the point the main devs have already CHANGED defaults to higher numbers then they promoted years ago
defaults were lower.. but thanks for proving the point by saying defaults are higher. in your own words

You have given enough data and passed alot of information on the LN and am sure before it was adopted as the network for Lugano who just accepted BTC and cryptocurrencies for use in the Swiss, they must have trusted the network to perform better. There was a memorandum of understanding signed between Lugano and El Salvador before this launch was effected by Lugano and am sure the right test and set up has been ensured to make sure the lightening network works better and delivers beyond expectation seeing it will serve more users and devices simultaneously.

lugano didnt 'just accept bitcoin' before this.. the legalisation of crypto in swiss is new and this is a first test phase using the LVGA and bitfinex (its less than a year old since it was first talked about, let along the less time of actual offering)
also there was no "memorandum" between lugano and el salvador.. seems you dont know what you are talking about. try to look deeper and do some research. lets not pretend there is already some great success and some big organisation and big processing that has gone on

the lugano area project is not using bitcoin, its using LN. and when looking at all LN stats of the last 6 months. capacity, node and channel cunt is dropping not rising. so its not as if lugano are adopting new people.. instead LN is losing users even when it is suppose to be introduced to a new city/country

[LoyceV]

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

Since it's custodial, I would have expected them to charge a fee on all transactions, but:

Out of 763,130 Lightning payments made by Wallet of Satoshi users last month, a whopping 684,120 had ZERO fees!
💸For those with fees, the average was just 0.03%, less than half a cent on a $10 payment. Efficiency at its finest!
⚡️WoS doesn’t charge any fees for Lightning payments; those tiny fees come from nodes that help route the payment to its destination.

I haven't used custodial LN since BlueWallet stopped their service (I switched to Phoenix Wallet), but it looks like I should give this a try again.

[franky1]

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

Since it's custodial, I would have expected them to charge a fee on all transactions, but:

Out of 763,130 Lightning payments made by Wallet of Satoshi users last month, a whopping 684,120 had ZERO fees!
💸For those with fees, the average was just 0.03%, less than half a cent on a $10 payment. Efficiency at its finest!
⚡️WoS doesn’t charge any fees for Lightning payments; those tiny fees come from nodes that help route the payment to its destination.

I haven't used custodial LN since BlueWallet stopped their service (I switched to Phoenix Wallet), but it looks like I should give this a try again.

i expect the zero fee offering is if your imprisonment of custody in WOS(buying their credit) enables free fee if the destination is another prisoner of custody of WOS(WOS credit)
as for payments to destinations outside of WoS prisoners. well the external hop charge WoS may average 0.03% of value.. but then you have to calculate how many hops by non WoS on a route may be involved as the users routing through WoS would end up paying more then 0.03% total

and funny how WoS reports LN done 763k yet 684k (89%) are internal

[kryptqnick]

The lightning network isn't a saviour some people thought it would be. It doesn't really solve the issues that Bitcoin has (the price and time it takes for transaction fees to get confirmed, and how both increase when the network gets congested). It's not the thing that makes Bitcoin a viable replacement of fiat for daily purchases because it's harder to use and doesn't always lead to very low fees, from what I've heard. So it's not the solution, but it's a solution, in a way. It's certainly not a failure. I think it's okay to wait and see if it gets better later on.

[legiteum]

The lightning network isn't a saviour some people thought it would be. It doesn't really solve the issues that Bitcoin has (the price and time it takes for transaction fees to get confirmed, and how both increase when the network gets congested). It's not the thing that makes Bitcoin a viable replacement of fiat for daily purchases because it's harder to use and doesn't always lead to very low fees, from what I've heard. So it's not the solution, but it's a solution, in a way. It's certainly not a failure. I think it's okay to wait and see if it gets better later on.

But if LN doesn't handle a mainstream transaction load such that it could be used for everyday transactions, then... what purpose does it serve? Why not just use normal Bitcoin transactions?

By the way, I continue to be a little bit dumfounded that in a community of thousands of deep thinking technical people the central tradeoff of centralization, safety, latency and cost hasn't been quantified. For me, as a 30 year veteran of high-scale architectures, it took me about five minutes to understand that Bitcoin, or anything based on blockchain, would never scale to mainstream loads. And hence my viewpoint is that insofar as a project gets closer to doing so, it gets further from being actual blockchain in the way that it was meant to be used.

As a technical architect I usually try to make my point with theory, but in this case the empirical evidence is inescapable: they've been working on the problem for over 13 years and it's only become worse, not better (which, if you understand the theory, is exactly what you'd expect).

The Bitcoin project and all of the sundry blockchain-based projects would be better served to stop wasting time trying to make blockchain something it is not, something it was never meant to be, and something that it cannot ever be no matter how hard they try.

Or to put it yet another way: Bitcoin already has a "lightning network": it's called the ETF and/or central brokerages that store a representation of people's holdings in an ordinary centralized database.

Most consumers today see a purchase of Bitcoin as something that only takes a few seconds and only costs a few dollars. That's because they aren't actually transacting in Bitcoin. And guess what: most consumers don't care about "decentralization" and they don't even know what that means.

Lightning Network, to me, seems like a project that was generated by denying these core truths.

[Kelward]

Lightening network is yet to become popular and adopted in majority of Bitcoin transactions, despite it's existence for many years, the major reason that I hear regarding it is that it's complex to understand and people needs a simple transaction process for their Bitcoin. Couple of months back when transaction fees were so high I was expecting lightening network to get a massive adoption, but it didn't and I'm concluding that it has failed to a large extent, although we can't write off LN yet, hopefully their dev. teams will hopefully upgrade it to be less complex, because that's the main reason that I hear from the average crypto holders.

[Abiky]

When I first heard about lightning it was almost 10 years ago. I thought it was going to be amazing. However it never really caught on and I am surprised.

I think that most people just stopped using bitcoin for micro payments and which Switched to stablecoins on l2 networks like ETH, ARB, Polygon, etc.

ETH fees are high now but they weren’t when USDT launched on it many years back. I think many people utilized it. Then they switched to maybe Tron or Solana for near free transactions.

Hence why lightning never became larger.

Why can't the LN succeed the same way ETH-based L2 networks (Arbitrum, Base, Optimism) succeeded? I guess that's because people consider Bitcoin as an investment than a currency. ETH is viewed among many as a "utility token", especially when it's needed for interacting with smart contracts (dApps). I don't know how BTC developers are going to pull it off, especially when many exchanges still haven't adopted the LN yet. Coinbase recently made a partnership with Lightspark to add support for the LN.

Maybe there's hope after all? If the LN gets perfected, it could become the main railway for day-to-day BTC transactions. The future is unpredictable, so anything's possible.

[franky1]

When I first heard about lightning it was almost 10 years ago. I thought it was going to be amazing. However it never really caught on and I am surprised.

I think that most people just stopped using bitcoin for micro payments and which Switched to stablecoins on l2 networks like ETH, ARB, Polygon, etc.

ETH fees are high now but they weren’t when USDT launched on it many years back. I think many people utilized it. Then they switched to maybe Tron or Solana for near free transactions.

Hence why lightning never became larger.

Why can't the LN succeed the same way ETH-based L2 networks (Arbitrum, Base, Optimism) succeeded? I guess that's because people consider Bitcoin as an investment than a currency. ETH is viewed among many as a "utility token", especially when it's needed for interacting with smart contracts (dApps). I don't know how BTC developers are going to pull it off, especially when many exchanges still haven't adopted the LN yet. Coinbase recently made a partnership with Lightspark to add support for the LN.

Maybe there's hope after all? If the LN gets perfected, it could become the main railway for day-to-day BTC transactions. The future is unpredictable, so anything's possible.

stop obsessing about LN prospects/plans of future
LN cant succeed due to failures of LN

.. now start thinking about other subnetworks that could do other tasks below bitcoin.. new subnetworks made from scratch that actually offer proper niche services(more securely/les flawed)..
dont start talking about how bitcoin is viewed and how it doesnt succeed where ethereum did.. instead see bitcoin has potential for financial utility of bitcoin and niche services for subnetworks.. dont get stuck in the bitcoin or LN as only option where bitcoin becomes junk and only LN becomes financial.. those are not the only options going forward.

there doesnt need to be one solo subnetwork everyone needs to move to and avoid bitcoin mainnet use..

[ABCbits]

When I first heard about lightning it was almost 10 years ago. I thought it was going to be amazing. However it never really caught on and I am surprised.

I think that most people just stopped using bitcoin for micro payments and which Switched to stablecoins on l2 networks like ETH, ARB, Polygon, etc.

ETH fees are high now but they weren’t when USDT launched on it many years back. I think many people utilized it. Then they switched to maybe Tron or Solana for near free transactions.

Hence why lightning never became larger.

Why can't the LN succeed the same way ETH-based L2 networks (Arbitrum, Base, Optimism) succeeded? I guess that's because people consider Bitcoin as an investment than a currency. ETH is viewed among many as a "utility token", especially when it's needed for interacting with smart contracts (dApps). I don't know how BTC developers are going to pull it off, especially when many exchanges still haven't adopted the LN yet. Coinbase recently made a partnership with Lightspark to add support for the LN.

Maybe there's hope after all? If the LN gets perfected, it could become the main railway for day-to-day BTC transactions. The future is unpredictable, so anything's possible.

It's probably also because LN is more complicated. On LN, the wallet need to consider many things such as transaction routing, maximum coin can be send and maximum coin can be received, while L2 doesn't have that kind of complexity.

[barto123]

Yes I think in a lot of way it's a failure, most Bitcoin maxis are in denial.

i just a saw tweet from a maxi telling people to use custodial lightning wallet - this is centralization. this is what we're trying to avoid. Goes against everything Satoshi envisioned

I stopped running a lightning node because it's not real user friendly, i lost funds, my channels got closed. it's not reliable enough to make payments (unless connected to large centralized nodes) & I don't trust it's privacy. of course, if this changes in the future, I may go back. Until then, i prefer onchain.

problem is there no privacy onchain, unless you're willing to put in a lot of work & discipline, Coinjoin is super expensive, time consuming, & it only obfuscates your transactions.

Bitcoin fees will likely skyrocket rise as the price rises. The cost to open a lightning channel will rise too.

To me, Monero is the next logical move to scale and get privacy (top 2 priorities). It has dynamic block sizes to scale, keep fees low & it's about to get a massive upgrade to privacy - will have a huge anonymity set. Will make Coinjoin look like a joke.

Also, it's the most used & widely accepted privacy coin online (#1 on darknet markets), has lots of support for wallets, there's plenty of options to trade P2P without KYC, various decentralized exchanges (more coming online), working atomic swaps too....it's a thriving network. almost no one is paying attention to. IMO it's the only one that has a real chance to flip BTC.

[ABCbits]

Yes I think in a lot of way it's a failure, most Bitcoin maxis are in denial.

i just a saw tweet from a maxi telling people to use custodial lightning wallet - this is centralization. this is what we're trying to avoid. Goes against everything Satoshi envisioned

Bitcoin maximalist doesn't necessary mean they also LN maximalist.

I stopped running a lightning node because it's not real user friendly, i lost funds, my channels got closed. it's not reliable enough to make payments (unless connected to large centralized nodes) & I don't trust it's privacy. of course, if this changes in the future, I may go back. Until then, i prefer onchain.

At least for privacy, IMO it's onion-routed payment offer decent privacy. But otherwise, i agree running LN node could be difficult and payment could fail due to LN complexity.

[LoyceV]

Yes I think in a lot of way it's a failure, most Bitcoin maxis are in denial.

i just a saw tweet from a maxi telling people to use custodial lightning wallet - this is centralization. this is what we're trying to avoid. Goes against everything Satoshi envisioned

I'd argue a Bitcoin maximalist knows Bitcoin can't scale on-chain, and also knows it's okay to risk small amounts in a custodial wallet.

I stopped running a lightning node because it's not real user friendly

Custodial LN is a lot more user friendly, and I don't mind paying a few cents in fees for that.

IMO it's the only one that has a real chance to flip BTC.

Good tech isn't enough to become market leader. Monero will have to go up 550-fold to top Bitcoin.

[DeathAngel]

It’s not a failure, it’s just going to take time. Layer 1 Bitcoin is still niche in the mainstream so it’s going to take a lot longer before people are using Layer 2 to for example buy coffee with Bitcoin. Big changes in life, new tech takes a long time before it gains widespread mainstream adoption, have some patience.

[Abiky]

stop obsessing about LN prospects/plans of future
LN cant succeed due to failures of LN

.. now start thinking about other subnetworks that could do other tasks below bitcoin.. new subnetworks made from scratch that actually offer proper niche services(more securely/les flawed)..
dont start talking about how bitcoin is viewed and how it doesnt succeed where ethereum did.. instead see bitcoin has potential for financial utility of bitcoin and niche services for subnetworks.. dont get stuck in the bitcoin or LN as only option where bitcoin becomes junk and only LN becomes financial.. those are not the only options going forward.

there doesnt need to be one solo subnetwork everyone needs to move to and avoid bitcoin mainnet use..

By "subnetworks" do you mean "sidechains"? If that's the case, then yes, they're a much safer and reliable option than the LN. Bitcoin's use cases can be expanded far from the areas of finance. I've seen sidechains providing smart contracts functionality, as well as, decentralized storage capabilities. Unfortunately, these chains aren't as widely-recognized as the LN. The latter has strong marketing from crypto companies, businesses, and exchanges alike.

Although adoption for the LN is still low, it's certainly greater than sidechains. The solution to the high fee problem is already there. What's challenging is making people use alternative solutions to have a better experience with Bitcoin. With plenty of altcoins to choose from, why focus on scaling Bitcoin, anyways?

[B1-66ER]

Hi all,

I'm digging how Nostr social networks like Primal are using the Bitcoin Lightning Network for "zaps." via WebLN ..I think of them as instant, super cheap tips I can send to creators for great posts.  Like, if someone drops a hilarious meme or a really useful thread, I can fire off some Satoshis  their way.  The combo of Nostr's decentralized setup with Lightning sounds like a super combo..

If I am not mistake you don’t need to work as a donk to have 100K follows to start generating income for your digital content ..

That’s the user case for LN I find interresting..

[franky1]

stop obsessing about LN prospects/plans of future
LN cant succeed due to failures of LN

.. now start thinking about other subnetworks that could do other tasks below bitcoin.. new subnetworks made from scratch that actually offer proper niche services(more securely/les flawed)..
dont start talking about how bitcoin is viewed and how it doesnt succeed where ethereum did.. instead see bitcoin has potential for financial utility of bitcoin and niche services for subnetworks.. dont get stuck in the bitcoin or LN as only option where bitcoin becomes junk and only LN becomes financial.. those are not the only options going forward.

there doesnt need to be one solo subnetwork everyone needs to move to and avoid bitcoin mainnet use..

By "subnetworks" do you mean "sidechains"? If that's the case, then yes, they're a much safer and reliable option than the LN. Bitcoin's use cases can be expanded far from the areas of finance. I've seen sidechains providing smart contracts functionality, as well as, decentralized storage capabilities. Unfortunately, these chains aren't as widely-recognized as the LN. The latter has strong marketing from crypto companies, businesses, and exchanges alike.

Although adoption for the LN is still low, it's certainly greater than sidechains. The solution to the high fee problem is already there. What's challenging is making people use alternative solutions to have a better experience with Bitcoin. With plenty of altcoins to choose from, why focus on scaling Bitcoin, anyways?

subnetworks of bitcoin are all manner of network types that bridge/offboard to-from bitcoin. its the name of the "layer two" networks.
the term "layer2" and "ontop" have been abused by making other networks feel like they are above and better or a protective sheild/skin around bitcoin done so to subliminally suggest they are better and more secure/protected than bitcoin, trying to suggest that it is bitcoin that is the raw under-layer thats 'soft and weak' compared to 'hardened' other networks 'layer'..(skin of an orange metaphors).. so calling these other networks subnetworks puts them in their place properly so that people can be sure to know that its these subnetworks that are less secure, less important then blockchain mainnets

LN might be on a huge recruitment campaign. but looking at node and channel counts.. their campaign has been not so successful at recruiting, as there are other subnetworks with more liquidity locked, and devs of LN have admitted to LN flaws and losses of value and users

[LoyceV]

By "subnetworks" do you mean "sidechains"? If that's the case, then yes, they're a much safer and reliable option than the LN.

The main difference is that sidechains always rely on a certain third party, while LN can be non-custodial. I'll repeat what I said during high fees in 2017: I don't care how Bitcoin scales, as long as it does it.