Lightning Network Hits Record Capacity On Crypto Exchange Adoption

Lightning Network’s capacity reached an all-time high as exchanges increased adoption, while a new Taproot Assets update has enabled multi-asset transactions.

Bitcoin layer-2, the Lightning Network, has reached a new all-time capacity high amid increased adoption from major crypto exchanges and functionality improvements.

Lightning Network (LN) capacity reached 5,606 BTC on Monday, beating its previous record in March 2023, according to Bitcoin Visuals.

LN analytics platform Amboss also reported a capacity peak of 5,637 BTC, worth approximately $490 million, on Tuesday.

Data shows a surge in capacity in November and December, following a year of declines, as more Bitcoin was added to the network, enabling faster and cheaper transactions.

The number of Lightning nodes, which open payment channels with each other that are funded with Bitcoin (BTC), was at 14,940, down from a March 2022 peak of 20,700, while the number of channels between those nodes was at 48,678, also down from a 2022 peak.

The data indicates that more Bitcoin is being added to the LN, but not necessarily a corresponding increase in usage, as measured by the number of nodes and channels.

“It’s not just one company that’s putting more Bitcoin into the Lightning Network; it’s across the board,” said Amboss.

It highlighted that large crypto exchanges, such as Binance and OKX, have been depositing more BTC onto the LN this month, explaining the capacity jump.

Related: Tether leads $8M funding for Lightning startup focused on stablecoins

Source: CoinTelegraph