Bitcoin’s Lightning Network, a second-layer solution, has witnessed an estimated surge of 1,212% over two years, accommodating approximately 6.6 million routed transactions in August, a notable leap from 503,000 transactions in August 2021, as per data from the Bitcoin-exclusive exchange, River.
In a report dated October 10th, River’s research analyst Sam Wouters elucidated the spike in routed transactions — those utilizing more than two nodes for a transfer — occurred despite a 44% decline in Bitcoin’s price and significantly diminished online search interest.
Wouters, countering Lightning critics, stated in a follow-up post on X (previously Twitter) on October 10th, “The ‘Nobody is using Lightning’ narrative ought to be conclusively dispelled now.” River’s figure of 6.6 million Lightning-routed transactions represents a minimum estimate — the lowest viable value it could determine. The firm also extracted the 503,000 figure for August 2021 from a 2021 study by K33 (formerly Arcane Research), noting its inability to evaluate private Lightning transactions or those involving merely two parties. Additionally, Lightning processed $78.2 million in transaction volume in August 2023, a 546% augmentation from August 2021’s $12.1 million figure, provided by K33. Wouters pointed out that Lightning is currently handling at least 47% of Bitcoin’s on-chain transactions.
He added, “This metric will be fascinating to track, as it indicates Bitcoin evolving more towards a medium of exchange.” In August 2023, the average transaction size on Lightning was roughly 44,700 satoshis, or $11.84. River projected that between 279,000 and 1.1 million Lightning users were active in September.
The company attributed 27% of the transaction growth to the gaming, social media tipping, and streaming domains. River reported a 99.7% success rate for Lightning payments on its platform in August 2023, spanning 308,000 transactions. The primary cause for failure typically arises when no payment path can be located that possesses sufficient liquidity to enable the transfer.
The data set from River comprised 2.5 million transactions. The nodes in River’s data set account for 29% of the total capacity on the network and 10% of payment channels.
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